Cover Page
Cover Page - shares | 9 Months Ended | |
Aug. 31, 2020 | Sep. 29, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Aug. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 0-19417 | |
Entity Registrant Name | PROGRESS SOFTWARE CORP /MA | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 04-2746201 | |
Entity Address, Address Line One | 14 Oak Park | |
Entity Address, City or Town | Bedford | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 01730 | |
City Area Code | 781 | |
Local Phone Number | 280-4000 | |
Title of 12(b) Security | Common Stock, $0.01 par value per share | |
Trading Symbol | PRGS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 45,101,672 | |
Entity Central Index Key | 0000876167 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --11-30 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 220,575 | $ 154,259 |
Short-term investments | 9,544 | 19,426 |
Total cash, cash equivalents and short-term investments | 230,119 | 173,685 |
Accounts receivable (less allowances of $928 and $825, respectively) | 60,463 | 72,820 |
Unbilled receivables and contract assets | 13,967 | 10,880 |
Other current assets | 15,657 | 27,280 |
Total current assets | 320,206 | 284,665 |
Long-term unbilled receivables and contract assets | 8,740 | 12,492 |
Property and equipment, net | 28,111 | 29,765 |
Intangible assets, net | 81,934 | 99,392 |
Goodwill | 431,864 | 432,824 |
Deferred tax assets | 19,327 | 18,601 |
Operating lease right-of-use assets | 24,011 | 0 |
Other assets | 5,275 | 3,532 |
Total assets | 919,468 | 881,271 |
Current liabilities: | ||
Current portion of long-term debt, net | 16,361 | 10,717 |
Accounts payable | 6,372 | 10,603 |
Accrued compensation and related taxes | 24,904 | 34,444 |
Dividends payable to shareholders | 7,568 | 7,498 |
Short-term operating lease liabilities | 6,271 | 0 |
Income taxes payable | 3,339 | 1,444 |
Other accrued liabilities | 11,371 | 18,685 |
Short-term deferred revenue | 151,505 | 157,494 |
Total current liabilities | 227,691 | 240,885 |
Long-term debt, net | 271,261 | 284,002 |
Long-term operating lease liabilities | 19,442 | 0 |
Long-term deferred revenue | 19,851 | 19,752 |
Other noncurrent liabilities | 13,057 | 6,350 |
Commitments and contingencies | ||
Shareholders’ equity: | ||
Preferred stock, $0.01 par value; authorized, 10,000,000 shares; issued, none | 0 | 0 |
Common stock, $0.01 par value, and additional paid-in capital; authorized, 200,000,000 shares; issued and outstanding, 45,101,672 shares in 2020 and 45,036,441 shares in 2019 | 311,342 | 295,953 |
Retained earnings | 90,425 | 64,303 |
Accumulated other comprehensive loss | (33,601) | (29,974) |
Total shareholders’ equity | 368,166 | 330,282 |
Total liabilities and shareholders’ equity | $ 919,468 | $ 881,271 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Assets | ||
Allowance for accounts receivable | $ 928 | $ 825 |
Stockholders' Equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 45,101,672 | 45,036,441 |
Common stock, shares outstanding (in shares) | 45,101,672 | 45,036,441 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Revenue: | ||||
Total revenue | $ 109,699 | $ 106,716 | $ 319,765 | $ 296,260 |
Costs of revenue: | ||||
Total costs of revenue | 14,738 | 20,825 | 43,883 | 54,475 |
Amortization of acquired intangibles | 1,664 | 7,458 | 4,974 | 18,997 |
Gross profit | 94,961 | 85,891 | 275,882 | 241,785 |
Operating expenses: | ||||
Sales and marketing | 22,186 | 25,177 | 68,100 | 72,332 |
Product development | 20,676 | 23,126 | 64,117 | 64,704 |
General and administrative | 13,514 | 13,506 | 38,702 | 38,445 |
Amortization of acquired intangibles | 4,176 | 7,068 | 12,484 | 14,841 |
Restructuring expenses | 91 | 801 | 1,826 | 3,993 |
Acquisition-related expenses | 1,125 | 253 | 1,439 | 1,360 |
Total operating expenses | 61,768 | 69,931 | 186,668 | 195,675 |
Income from operations | 33,193 | 15,960 | 89,214 | 46,110 |
Other (expense) income: | ||||
Interest expense | (2,302) | (3,321) | (7,692) | (6,920) |
Interest income and other, net | 110 | 377 | 443 | 950 |
Foreign currency loss, net | (770) | (774) | (1,957) | (2,068) |
Total other expense, net | (2,962) | (3,718) | (9,206) | (8,038) |
Income before income taxes | 30,231 | 12,242 | 80,008 | 38,072 |
Provision (benefit) for income taxes | 6,254 | (1,315) | 17,947 | 6,932 |
Net income | $ 23,977 | $ 13,557 | $ 62,061 | $ 31,140 |
Earnings per share: | ||||
Basic (in dollars per share) | $ 0.53 | $ 0.30 | $ 1.38 | $ 0.70 |
Diluted (in dollars per share) | $ 0.53 | $ 0.30 | $ 1.37 | $ 0.69 |
Weighted average shares outstanding: | ||||
Basic (in shares) | 45,036 | 44,716 | 44,941 | 44,761 |
Diluted (in shares) | 45,364 | 45,303 | 45,382 | 45,292 |
Cash dividends declared per common share (in dollars per share) | $ 0.165 | $ 0.155 | $ 0.495 | $ 0.465 |
Software licenses | ||||
Revenue: | ||||
Total revenue | $ 27,514 | $ 30,686 | $ 77,806 | $ 83,216 |
Costs of revenue: | ||||
Total costs of revenue | 1,103 | 1,204 | 3,302 | 3,296 |
Maintenance and services | ||||
Revenue: | ||||
Total revenue | 82,185 | 76,030 | 241,959 | 213,044 |
Costs of revenue: | ||||
Total costs of revenue | $ 11,971 | $ 12,163 | $ 35,607 | $ 32,182 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 23,977 | $ 13,557 | $ 62,061 | $ 31,140 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustments | 4,564 | (1,961) | 374 | (2,512) |
Unrealized gain (loss) on hedging activity, net of tax provision of $166 and tax benefit of $1,302 for the third quarter and first nine months of 2020, respectively, and of tax provision of $820 for the third quarter and first nine months of 2019 | 58 | (2,528) | (4,106) | (2,528) |
Unrealized gain on investments, net of tax benefit of $42 and tax provision of $3 for the third quarter and first nine months of 2020, respectively, and $6 and $54 for the third quarter and first nine months of 2019, respectively | 21 | 57 | 105 | 194 |
Total other comprehensive income (loss), net of tax | 4,643 | (4,432) | (3,627) | (4,846) |
Comprehensive income | $ 28,620 | $ 9,125 | $ 58,434 | $ 26,294 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Tax provision (benefit) on unrealized loss on hedging activity | $ 166 | $ 820 | $ (1,302) | $ 820 |
Tax provision (benefit) on accumulated unrealized gain on investments | $ (42) | $ 6 | $ 3 | $ 54 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Shareholders’ Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid-In Capital | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss |
Beginning balance (in shares) at Nov. 30, 2018 | 45,115,000 | ||||||
Beginning balance at Nov. 30, 2018 | $ 324,002 | $ 4,781 | $ 451 | $ 266,602 | $ 85,125 | $ 4,781 | $ (28,176) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of stock under employee stock purchase plan (in shares) | 141,000 | ||||||
Issuance of stock under employee stock purchase plan | 4,045 | $ 1 | 4,044 | ||||
Exercise of stock options (in shares) | 64,000 | ||||||
Exercise of stock options | 1,881 | $ 1 | 1,880 | ||||
Vesting of restricted stock units and release of deferred stock units (in shares) | 147,000 | ||||||
Vesting of restricted stock units and release of deferred stock units | 0 | $ 1 | (1) | ||||
Withholding tax payments related to net issuance of restricted stock units (in shares) | (37,000) | ||||||
Withholding tax payments related to net issuance of restricted stock units | (1,637) | (1,637) | |||||
Stock-based compensation | 17,411 | 17,411 | |||||
Issuance of shares related to non-compete agreement (in shares) | 44,000 | ||||||
Issuance of shares related to non-compete agreement | 2,000 | 2,000 | |||||
Dividends declared | $ (20,825) | (20,825) | |||||
Treasury stock repurchases and retirements (in shares) | (700,000) | (688,000) | |||||
Treasury stock repurchases and retirements | $ (25,000) | $ (6) | (1,259) | (23,735) | |||
Net income | 31,140 | 31,140 | |||||
Other comprehensive income (loss) | (4,846) | (4,846) | |||||
Ending balance (in shares) at Aug. 31, 2019 | 44,786,000 | ||||||
Ending balance at Aug. 31, 2019 | 332,952 | $ 448 | 289,040 | 76,486 | (33,022) | ||
Beginning balance (in shares) at May. 31, 2019 | 44,723,000 | ||||||
Beginning balance at May. 31, 2019 | 315,347 | $ 8,178 | $ 448 | 281,745 | 61,744 | $ 8,178 | (28,590) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of stock under employee stock purchase plan (in shares) | 42,000 | ||||||
Issuance of stock under employee stock purchase plan | 1,242 | 1,242 | |||||
Exercise of stock options (in shares) | 20,000 | ||||||
Exercise of stock options | 563 | 563 | |||||
Vesting of restricted stock units and release of deferred stock units (in shares) | 1,000 | ||||||
Vesting of restricted stock units and release of deferred stock units | 0 | ||||||
Stock-based compensation | 5,490 | 5,490 | |||||
Dividends declared | $ (6,993) | (6,993) | |||||
Treasury stock repurchases and retirements (in shares) | 0 | ||||||
Net income | $ 13,557 | 13,557 | |||||
Other comprehensive income (loss) | (4,432) | (4,432) | |||||
Ending balance (in shares) at Aug. 31, 2019 | 44,786,000 | ||||||
Ending balance at Aug. 31, 2019 | $ 332,952 | $ 448 | 289,040 | 76,486 | (33,022) | ||
Beginning balance (in shares) at Nov. 30, 2019 | 45,036,441 | 45,037,000 | |||||
Beginning balance at Nov. 30, 2019 | $ 330,282 | $ 450 | 295,503 | 64,303 | (29,974) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of stock under employee stock purchase plan (in shares) | 178,000 | ||||||
Issuance of stock under employee stock purchase plan | 4,986 | $ 2 | 4,984 | ||||
Exercise of stock options (in shares) | 115,000 | ||||||
Exercise of stock options | 3,607 | $ 1 | 3,606 | ||||
Vesting of restricted stock units and release of deferred stock units (in shares) | 197,000 | ||||||
Vesting of restricted stock units and release of deferred stock units | 0 | $ 2 | (2) | ||||
Withholding tax payments related to net issuance of restricted stock units | (4,072) | (4,072) | |||||
Stock-based compensation | 17,359 | 17,359 | |||||
Dividends declared | $ (22,430) | (22,430) | |||||
Treasury stock repurchases and retirements (in shares) | (400,000) | (426,000) | |||||
Treasury stock repurchases and retirements | $ (20,000) | $ (4) | (6,487) | (13,509) | |||
Net income | 62,061 | 62,061 | |||||
Other comprehensive income (loss) | $ (3,627) | (3,627) | |||||
Ending balance (in shares) at Aug. 31, 2020 | 45,101,672 | 45,101,000 | |||||
Ending balance at Aug. 31, 2020 | $ 368,166 | $ 451 | 310,891 | 90,425 | (33,601) | ||
Beginning balance (in shares) at May. 31, 2020 | 45,033,000 | ||||||
Beginning balance at May. 31, 2020 | 339,961 | $ 450 | 303,832 | 73,923 | (38,244) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of stock under employee stock purchase plan (in shares) | 54,000 | ||||||
Issuance of stock under employee stock purchase plan | 1,473 | $ 1 | 1,472 | ||||
Exercise of stock options (in shares) | 2,000 | ||||||
Exercise of stock options | 79 | $ 0 | 79 | ||||
Vesting of restricted stock units and release of deferred stock units (in shares) | 12,000 | ||||||
Vesting of restricted stock units and release of deferred stock units | 0 | ||||||
Withholding tax payments related to net issuance of restricted stock units | (177) | (177) | |||||
Stock-based compensation | 5,685 | 5,685 | |||||
Dividends declared | $ (7,475) | (7,475) | |||||
Treasury stock repurchases and retirements (in shares) | 0 | ||||||
Net income | $ 23,977 | 23,977 | |||||
Other comprehensive income (loss) | $ 4,643 | 4,643 | |||||
Ending balance (in shares) at Aug. 31, 2020 | 45,101,672 | 45,101,000 | |||||
Ending balance at Aug. 31, 2020 | $ 368,166 | $ 451 | $ 310,891 | $ 90,425 | $ (33,601) |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Cash flows from operating activities: | ||
Net income | $ 62,061 | $ 31,140 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization of property and equipment | 4,737 | 5,523 |
Amortization of acquired intangibles and other | 17,984 | 34,637 |
Stock-based compensation | 17,359 | 17,411 |
Non-cash lease expense | 6,652 | 0 |
Loss on disposal of property and equipment | 704 | 157 |
Deferred income taxes | 539 | (6,005) |
Allowances for bad debt and sales credits | 416 | 153 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 13,622 | (8,604) |
Other assets | 9,178 | 6,034 |
Accounts payable and accrued liabilities | (18,044) | (3,875) |
Lease liabilities | (5,979) | 0 |
Income taxes payable | 793 | 1,654 |
Deferred revenue | (7,937) | 13,658 |
Net cash flows from operating activities | 102,085 | 91,883 |
Cash flows from (used in) investing activities: | ||
Purchases of investments | (5,009) | (8,900) |
Sales and maturities of investments | 14,901 | 21,780 |
Purchases of property and equipment | (3,419) | (1,830) |
Payments for acquisitions, net of cash acquired | 0 | (225,298) |
Proceeds from sale of property, plant and equipment, net | 0 | 6,146 |
Net cash flows from (used in) investing activities | 6,473 | (208,102) |
Cash flows (used in) from financing activities: | ||
Proceeds from stock-based compensation plans | 9,027 | 6,347 |
Payments for taxes related to net share settlements of equity awards | (4,072) | (1,637) |
Repurchases of common stock | (20,000) | (25,000) |
Dividend payments to shareholders | (22,358) | (20,819) |
Proceeds from the issuance of debt | 0 | 184,984 |
Payment of principle on long-term debt | (7,525) | (3,427) |
Payment of issuance costs for long-term debt | 0 | (1,611) |
Net cash flows (used in) from financing activities | (44,928) | 138,837 |
Effect of exchange rate changes on cash | 2,686 | (3,724) |
Net increase in cash and cash equivalents | 66,316 | 18,894 |
Cash and cash equivalents, beginning of period | 154,259 | 105,126 |
Cash and cash equivalents, end of period | 220,575 | 124,020 |
Supplemental disclosure: | ||
Cash paid for income taxes, net of refunds of $557 in 2020 and $1,293 in 2019 | 7,052 | 4,821 |
Cash paid for interest | 6,864 | 5,972 |
Non-cash investing and financing activities: | ||
Total fair value of restricted stock awards, restricted stock units and deferred stock units on date vested | 12,786 | 8,190 |
Dividends declared | $ 7,568 | $ 7,003 |
Condensed Consolidated Statem_6
Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 9 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Statement of Cash Flows [Abstract] | ||
Proceeds from income tax refunds | $ 557 | $ 1,293 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Aug. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Company Overview - Progress Software Corporation ("Progress," the "Company," "we," "us," or "our") offers the leading platform for developing and deploying strategic business applications. We enable customers and partners to deliver modern, high-impact digital experiences with a fraction of the effort, time and cost. Progress offers powerful tools for easily building adaptive user experiences across any type of device or touchpoint, the flexibility of a cloud-native app dev platform to deliver modern apps, leading data connectivity technology, web content management, business rules, secure file transfer and network monitoring. Over 1,700 independent software vendors ("ISVs"), 100,000 enterprise customers, and 2 million developers rely on Progress to power their applications. Our products are generally sold as perpetual licenses, but certain products also use term licensing models and our cloud-based offerings use a subscription-based model. More than half of our worldwide license revenue is realized through relationships with indirect channel partners, principally application partners, original equipment manufacturers ("OEMs"), distributors and value-added resellers. Application partners are ISVs that develop and market applications using our technology and resell our products in conjunction with sales of their own products that incorporate our technology. OEMs are companies that embed our products into their own software products or devices. Value-added resellers are companies that add features or services to our product, then resell it as an integrated product or complete "turn-key" solution. We operate in North America and Latin America (the "Americas"); Europe, the Middle East and Africa ("EMEA"); and the Asia Pacific region, through local subsidiaries as well as independent distributors. Basis of Presentation and Significant Accounting Policies - We prepared the accompanying unaudited condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") regarding interim financial reporting. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America ("GAAP") for complete financial statements and these unaudited financial statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2019 ("2019 10-K"). We made no material changes in the application of our significant accounting policies that were disclosed in our 2019 10-K. We have prepared the accompanying unaudited condensed consolidated financial statements on the same basis as the audited financial statements included in our 2019 10-K, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full fiscal year. Use of Estimates The preparation of financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an on-going basis, management evaluates its estimates and records changes in estimates in the period in which they become known. These estimates are based on historical data and experience, as well as various other assumptions that management believes to be reasonable under the circumstances. The most significant estimates relate to: the timing and amount of revenue recognition, including the determination of the nature and timing of the satisfaction of performance obligations, the standalone selling price of performance obligations, and the transaction price allocated to performance obligations; the realization of tax assets and estimates of tax liabilities; fair values of investments in marketable securities; assets held for sale; intangible assets and goodwill valuations; the recognition and disclosure of contingent liabilities; the collectability of accounts receivable; and assumptions used to determine the fair value of stock-based compensation. Actual results could differ from those estimates. Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In August 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12"). ASU 2017-12 intends to better align an entity's risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. We adopted this standard at the beginning of the first quarter of fiscal year 2020; however, our existing accounting aligned with the guidance of ASU 2017-12 and therefore there was no impact to our financial statements from adoption. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASC 842"). ASC 842 supersedes the requirements in Topic 840, Leases , and requires lessees to recognize right-of-use ("ROU") assets and liabilities for leases with lease terms of more than twelve months. ASC 842 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2018. We adopted ASC 842 effective December 1, 2019 using the modified retrospective transition method of applying the new standard at the adoption date. Results for reporting periods beginning on or after December 1, 2019 are presented under the new guidance, while prior period amounts have not been adjusted and continue to be reported in accordance with previous guidance. Disclosures required under the new standard will not be provided for dates and periods before December 1, 2019. The new standard provided a number of optional practical expedients in transition. We elected the transition package of practical expedients available in the standard, which allowed the carry forward of historical assessments of whether a contract contains a lease, lease classification and initial direct costs. We also elected the practical expedient provided in ASC 842 to not separate lease components from non-lease components for each material underlying asset class: office leases, vehicle leases and equipment leases. For each lease, the non-lease components and related lease components are accounted for as a single lease component. Items or activities that do not transfer goods or services to the lessee, such as administrative tasks to set up the contract and reimbursement or payment of lessor costs, are not components of the contract and therefore no contract consideration is allocated to such items or activities. We did not elect the hindsight practical expedient to determine the lease term for existing leases. The adoption of the new standard also resulted in significant additional disclosures regarding our leasing activities. Refer to Note 8 for further details. Recently Issued Accounting Pronouncements Not Yet Adopted In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles - Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 amends Topic 350 to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. This update requires the performance of an annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. However, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The guidance in ASU 2017-04 is required for annual reporting periods beginning after December 15, 2019, with early adoption permitted. Upon adoption, we do not expect this update to have a material effect on our consolidated financial position and results of operations. In June 2016, the FASB issued Accounting Standards Update No. 2016-13, Financial Instruments - Credit Losses (Topic 326) ("ASU 2016-13"). ASU 2016-13 changes the impairment model for most financial assets and certain other instruments. Entities will be required to use a model that will result in the earlier recognition of allowances for losses for trade and other receivables, contract assets, held-to-maturity debt securities, loans, and other instruments. ASU 2016-13 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted. We are currently evaluating the impact of ASU 2016-13 on our consolidated financial statements. |
Cash, Cash Equivalents and Inve
Cash, Cash Equivalents and Investments | 9 Months Ended |
Aug. 31, 2020 | |
Investments and Cash [Abstract] | |
Cash, Cash Equivalents and Investments | Cash, Cash Equivalents and Investments A summary of our cash, cash equivalents and available-for-sale investments at August 31, 2020 is as follows (in thousands): Amortized Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash $ 214,037 $ — $ — $ 214,037 Money market funds 6,538 — — 6,538 U.S. treasury bonds 4,994 75 — 5,069 Corporate bonds 4,419 56 — 4,475 Total $ 229,988 $ 131 $ — $ 230,119 A summary of our cash, cash equivalents and available-for-sale investments at November 30, 2019 is as follows (in thousands): Amortized Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash $ 144,346 $ — $ — $ 144,346 Money market funds 9,913 — — 9,913 State and municipal bond obligations 7,036 1 — 7,037 U.S. treasury bonds 7,221 10 — 7,231 Corporate bonds 5,146 12 — 5,158 Total $ 173,662 $ 23 $ — $ 173,685 Such amounts are classified on our condensed consolidated balance sheets as follows (in thousands): August 31, 2020 November 30, 2019 Cash and Equivalents Short-Term Investments Cash and Equivalents Short-Term Investments Cash $ 214,037 $ — $ 144,346 $ — Money market funds 6,538 — 9,913 — State and municipal bond obligations — — — 7,037 U.S. treasury bonds — 5,069 — 7,231 Corporate bonds — 4,475 — 5,158 Total $ 220,575 $ 9,544 $ 154,259 $ 19,426 The fair value of debt securities by contractual maturity is as follows (in thousands): August 31, 2020 November 30, 2019 Due in one year or less $ 5,703 $ 14,004 Due after one year (1) 3,841 5,422 Total $ 9,544 $ 19,426 (1) Includes U.S. treasury bonds and corporate bonds, which are securities representing investments available for current operations and are classified as current on the condensed consolidated balance sheets. We did not hold any investments with continuous unrealized losses as of August 31, 2020 or November 30, 2019. |
Derivative Instruments
Derivative Instruments | 9 Months Ended |
Aug. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments Cash Flow Hedge On July 9, 2019, we entered into an interest rate swap contract with an initial notional amount of $150.0 million to manage the variability of cash flows associated with approximately one-half of our variable rate debt. The contract matures on April 30, 2024 and requires periodic interest rate settlements. Under this interest rate swap contract, we receive a floating rate based on the greater of 1-month LIBOR or 0.00%, and pay a fixed rate of 1.855% on the outstanding notional amount. We have designated the interes t rate swap as a cash flow hedge and assess the hedge effectiveness both at the onset of the hedge and at regular intervals throughout the life of the derivative. To the extent that the interest rate swap is highly effective in offsetting the variability of the hedged cash flows, changes in the fair value of the derivative are included as a component of other comprehensive loss on our condensed consolidated balance sheets. Although we have determined at the onset of the hedge that the interest rate swap will be a highly effective hedge throughout the term of the contract, any portion of the fair value swap subsequently determined to be ineffective will be recognized in earnings. As of August 31, 2020 and November 30, 2019, the fair value of the hedge was a loss of $7.5 million and $2.1 million, respectively, which was included in other noncurrent liabilities on our condensed consolidated balance sheets. The following table presents our interest rate swap contract where the notional amount reflects the quarterly amortization of the interest rate swap, which is equal to approximately one-half of the corresponding reduction in the balance of our term loan as we make scheduled principal payments. The fair value of the derivative represents the discounted value of the expected future discounted cash flows for the interest rate swap, based on the amortization schedule and the current forward curve for the remaining term of the contract, as of the date of each reporting period (in thousands): August 31, 2020 November 30, 2019 Notional Value Fair Value Notional Value Fair Value Interest rate swap contracts designated as cash flow hedges $ 144,375 $ (7,462) $ 148,125 $ (2,054) Forward Contracts We generally use forward contracts that are not designated as hedging instruments to hedge economically the impact of the variability in exchange rates on intercompany accounts receivable and loans receivable denominated in certain foreign currencies. We generally do not hedge the net assets of our international subsidiaries. All forward contracts are recorded at fair value on the consolidated balance sheets at the end of each reporting period and expire between 30 days and two years from the date the contract was entered. At August 31, 2020, $1.4 million and $0.5 million was recorded in other assets and other current assets, respectively, on our condensed consolidated balance sheets. At November 30, 2019, $0.1 million was recorded in other noncurrent liabilities on our condensed consolidated balance sheets. In the three and nine months ended August 31, 2020, realized and unrealized gains of $4.5 million and $2.1 million, respectively, from our forward contracts were recognized in foreign currency loss, net, on our condensed consolidated statements of operations. In the three and nine months ended August 31, 2019, realized and unrealized losses of $1.6 million and $2.9 million, respectively, from our forward contracts were recognized in foreign currency loss, net on our condensed consolidated statements of operations. These gains and losses were substantially offset by realized and unrealized losses and gains on the offsetting positions. The table below details outstanding foreign currency forward contracts where the notional amount is determined using contract exchange rates (in thousands): August 31, 2020 November 30, 2019 Notional Value Fair Value Notional Value Fair Value Forward contracts to sell U.S. dollars $ 70,358 $ 1,915 $ 66,951 $ (85) Forward contracts to purchase U.S. dollars — — 1,457 5 Total $ 70,358 $ 1,915 $ 68,408 $ (80) |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Aug. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Recurring Fair Value Measurements The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at August 31, 2020 (in thousands): Fair Value Measurements Using Total Fair Value Level 1 Level 2 Level 3 Assets Money market funds $ 6,538 $ 6,538 $ — $ — U.S. treasury bonds 5,069 — 5,069 — Corporate bonds 4,475 — 4,475 — Foreign exchange derivatives 1,915 — 1,915 — Liabilities Interest rate swap $ (7,462) $ — $ (7,462) $ — The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at November 30, 2019 (in thousands): Fair Value Measurements Using Total Fair Value Level 1 Level 2 Level 3 Assets Money market funds $ 9,913 $ 9,913 $ — $ — State and municipal bond obligations 7,037 — 7,037 — U.S. treasury bonds 7,231 — 7,231 — Corporate bonds 5,158 — 5,158 — Liabilities Foreign exchange derivatives (80) — (80) — Interest rate swap $ (2,054) $ — $ (2,054) $ — When developing fair value estimates, we maximize the use of observable inputs and minimize the use of unobservable inputs. When available, we use quoted market prices to measure fair value. The valuation technique used to measure fair value for our Level 1 and Level 2 assets is a market approach, using prices and other relevant information generated by market transactions involving identical or comparable assets. If market prices are not available, the fair value measurement is based on models that use primarily market-based parameters including yield curves, volatilities, credit ratings and currency rates. In certain cases where market rate assumptions are not available, we are required to make judgments about assumptions market participants would use to estimate the fair value of a financial instrument. We did not have any nonrecurring fair value measurements as of August 31, 2020. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 9 Months Ended |
Aug. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | Intangible Assets and Goodwill Intangible Assets Intangible assets are comprised of the following significant classes (in thousands): August 31, 2020 November 30, 2019 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value Purchased technology $ 135,186 $ (110,941) $ 24,245 $ 135,186 $ (105,967) $ 29,219 Customer-related 134,042 (84,624) 49,418 134,042 (74,175) 59,867 Trademarks and trade names 24,740 (17,577) 7,163 24,740 (16,043) 8,697 Non-compete agreement 2,000 (892) 1,108 2,000 (391) 1,609 Total $ 295,968 $ (214,034) $ 81,934 $ 295,968 $ (196,576) $ 99,392 In the three and nine months ended August 31, 2020, amortization expense related to intangible assets was $5.8 million and $17.5 million, respectively. In the three and nine months ended August 31, 2019, amortization expense related to intangible assets was $14.5 million and $33.8 million, respectively. Future amortization expense for intangible assets as of August 31, 2020, is as follows (in thousands): Remainder of 2020 $ 5,777 2021 23,117 2022 22,136 2023 21,860 2024 9,044 Total $ 81,934 Goodwill Changes in the carrying amount of goodwill in the nine months ended August 31, 2020 are as follows (in thousands): Balance, November 30, 2019 $ 432,824 Measurement period adjustments (1) (838) Translation adjustments (122) Balance, August 31, 2020 $ 431,864 (1) Represents final measurement period adjustments related to our Ipswitch acquisition (Note 6) Changes in the goodwill balances by reportable segment in the nine months ended August 31, 2020 are as follows (in thousands): November 30, 2019 Measurement Period Adjustments Translation adjustments August 31, 2020 OpenEdge $ 366,819 $ (838) $ (122) $ 365,859 Data Connectivity and Integration 19,040 — — 19,040 Application Development and Deployment 46,965 — — 46,965 Total goodwill $ 432,824 $ (838) $ (122) $ 431,864 During the quarter ending August 31, 2020, no triggering events occurred that would indicate that it is more likely than not that the carrying values of any of our reporting units exceeded their fair values. |
Business Combinations
Business Combinations | 9 Months Ended |
Aug. 31, 2020 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations Ipswitch Acquisition On April 30, 2019, we completed the acquisition of all of the outstanding equity interests of Ipswitch, Inc. (“Ipswitch”) from Roger Greene (the “Seller”) pursuant to the Stock Purchase Agreement, dated as of March 28, 2019, by and among Progress, Ipswitch and the Seller. The acquisition was completed for an aggregate purchase price of $225.0 million, subject to certain customary adjustments as further described in the Stock Purchase Agreement, which was paid in cash. Pursuant to the Stock Purchase Agreement, $22.5 million of the purchase price was deposited into an escrow account to secure certain indemnification and other potential obligations of the Seller to Progress. This escrow was released in full in May 2020 upon expiration of the twelve-month escrow period. The Seller also received an award of approximately $2.0 million in Progress restricted stock as consideration for the Seller entering into a non-competition agreement for three years as set forth in the Stock Purchase Agreement. Ipswitch enables approximately 24,000 small and medium-sized businesses and enterprises to provide secure data sharing and ensure high-performance infrastructure availability. Through this acquisition, we bolstered our core offerings to small and medium-sized businesses and enterprises, enabling those businesses to respond faster to business demands and to improve productivity. We funded the acquisition through a combination of existing cash resources and a $185.0 million term loan, which is part of our $401.0 million term loan and revolving line of credit (Note 7). The purchase price has been allocated to Ipswitch’s tangible assets, identifiable intangible assets, and assumed liabilities based on their estimated fair values. The excess of the total consideration over the tangible assets, identifiable intangible assets, and assumed liabilities was recorded as goodwill. We recorded measurement period adjustments in accordance with FASB’s guidance regarding business combinations in the fourth quarter of fiscal year 2019 and the second quarter of fiscal year 2020 based on our valuation and purchase price allocation procedures. The measurement period adjustments, which were completed during the second quarter of fiscal year 2020, resulted in a decrease to goodwill of $0.6 million, primarily due to a decrease to the sales tax reserve, partially offset by increased accrued expenses. The following table discloses the net assets acquired in the business combination (in thousands): Initial Purchase Price Allocation Measurement Period Adjustments Final Purchase Price Allocation Life Net working capital $ 6,068 $ 651 $ 6,719 Property, plant and equipment 4,661 4,661 Purchased technology 33,100 33,100 5 years Trade name 9,600 9,600 5 years Customer relationships 66,600 66,600 5 years Other assets 314 (4) 310 Deferred revenue (12,696) (29) (12,725) Goodwill 117,651 (618) 117,033 Net assets acquired $ 225,298 $ — $ 225,298 The fair value of the intangible assets has been estimated using the income approach in which the after-tax cash flows are discounted to present value. The cash flows are based on estimates used to value the acquisition, and the discount rates applied were benchmarked with reference to the implied rate of return from the transaction model as well as the weighted average cost of capital. The valuation assumptions take into consideration the Company's estimates of customer attrition, technology obsolescence, and revenue growth projections. Based on the valuation, the acquired intangible assets are comprised of customer relationships of approximately $66.6 million, existing technology of approximately $33.1 million, and trade names of approximately $9.6 million. Tangible assets acquired and assumed liabilities were recorded at fair value. The valuation of the assumed deferred revenue was based on our contractual commitment to provide post-contract customer support to Ipswitch customers and future contractual performance obligations under existing hosting arrangements. The fair value of this assumed liability was based on the estimated cost plus a reasonable margin to fulfill these service obligations. A significant portion of the deferred revenue was recognized in the 12 months following the acquisition. We recorded the excess of the purchase price over the identified tangible and intangible assets as goodwill. We believe that the investment value of the future enhancement of our product offerings created as a result of this acquisition has principally contributed to a purchase price that resulted in the recognition of $117.0 million of goodwill, which is deductible for tax purposes. An election was made under Section 338(h)(10) of the Internal Revenue Code for Ipswitch to treat the transaction as a sale all of its assets on the acquisition date and subsequent liquidation. As a result, the identifiable intangible assets and goodwill are deductible for tax purposes. As previously noted, the Seller received a restricted stock award of approximately $2.0 million, subject to continued compliance with the three-year non-compete agreement. We concluded that the restricted stock award is not a compensation arrangement and we recorded the fair value of the award as an intangible asset separate from goodwill. We will recognize intangible asset amortization expense over the term of the agreement, which is 3 years. We recorded $0.5 million of amortization expense related to this restricted stock award for the nine months ended August 31, 2020 in operating expenses on our condensed consolidated statement of operations. Acquisition-related transaction costs (e.g., legal, due diligence, valuation, and other professional fees) and certain acquisition restructuring and related charges are not included as a component of consideration transferred but are required to be expensed as incurred. During the three and nine months ended August 31, 2020, we incurred approximately $0.1 million and $0.4 million of acquisition-related costs, respectively, which are included in acquisition-related expenses on our condensed consolidated statement of operations. The operations of Ipswitch are included in our operating results as part of the OpenEdge segment from the date of acquisition. The amount of revenue of Ipswitch included in our unaudited condensed consolidated statement of operations during each of the three and nine months ended August 31, 2020 was approximately $17.6 million and $50.1 million, respectively. The amount of revenue of Ipswitch included in our unaudited condensed consolidated statement of operations during the three and nine months ended August 31, 2019 was approximately $10.7 million and $14.0 million, respectively. We determined that disclosing the amount of Ipswitch related earnings included in the consolidated statements of operations is impracticable, as certain operations of Ipswitch were integrated into the operations of the Company from the date of acquisition. Pro Forma Information The following pro forma financial information presents the combined results of operations of Progress and Ipswitch as if the acquisition had occurred on December 1, 2017 after giving effect to certain pro forma adjustments. The pro forma adjustments reflected below include only those adjustments that are directly attributable to the Ipswitch acquisition and factually supportable. These pro forma adjustments include (i) a decrease in revenue from Ipswitch due to the beginning balance of deferred revenue being adjusted to reflect the fair value of the acquired balance, (ii) a net increase in amortization expense to record amortization expense for the $111.3 million of acquired identifiable intangible assets and to eliminate historical amortization of Ipswitch intangible assets, (iii) an increase in interest expense to record interest for the period presented as a result of the new credit facility entered into by Progress in connection with the acquisition, and (iv) the income tax effect of the adjustments made at the statutory tax rate of the U.S. (approximately 24.5%). In addition, prior to the acquisition Ipswitch did not pay entity level corporate tax, with the exception of some states, because it was registered as an S-Corporation. Therefore, we applied the statutory tax rate of the U.S. (approximately 24.5%) to the income before tax of Ipswitch as if the acquisition had occurred on December 1, 2017. The pro forma financial information does not reflect any adjustments for anticipated expense savings resulting from the acquisition and is not necessarily indicative of the operating results that would have actually occurred had the transaction been consummated on December 1, 2017. These results are prepared in accordance with ASC 606. (In thousands, except per share data) Pro Forma Revenue $ 325,248 Net income $ 24,381 Net income per basic share $ 0.54 Net income per diluted share $ 0.54 |
Term Loan and Line of Credit
Term Loan and Line of Credit | 9 Months Ended |
Aug. 31, 2020 | |
Line of Credit Facility [Abstract] | |
Term Loan and Line of Credit | Term Loan and Line of Credit On April 30, 2019, we entered into an amended and restated credit agreement (the "Credit Agreement"), which provides for a $301.0 million secured term loan and a $100.0 million secured revolving line of credit. The revolving line of credit may be made available in U.S. Dollars and certain other currencies and may be increased by up to an additional $125.0 million if the existing or additional lenders are willing to make such increased commitments. The revolving line of credit has sublimits for swing line loans up to $25.0 million and for the issuance of standby letters of credit in a face amount up to $25.0 million. The Credit Agreement modified our prior credit facility by extending the maturity date to April 30, 2024 and extending the principal repayments of the term loan. We borrowed an additional $185.0 million under the term loan as part of this modified credit facility. The new term loan was used to partially fund our acquisition of Ipswitch (Note 6) and we expect to use the revolving line of credit for general corporate purposes, which may include acquisitions of other businesses, and may also use it for working capital. Interest rates for the term loan and revolving line of credit are based upon our leverage ratio and determined based on an index selected at our option. The rates range from 1.50% to 2.00% above the Eurocurrency rate for Eurocurrency-based borrowings or from 0.50% to 1.00% above the defined base rate for base rate borrowings. Additionally, we may borrow certain foreign currencies at rates set in the same respective range above the London interbank offered interest rates for those currencies. A quarterly commitment fee on the undrawn portion of the revolving line of credit is required and ranges from 0.25% to 0.35% per annum based on our leverage ratio. The interest rate as of August 31, 2020 was 1.81%. The credit facility matures on April 30, 2024, when all amounts outstanding will be due and payable in full. The revolving line of credit does not require amortization of principal. The outstanding balance of the term loan as of August 31, 2020 was $289.7 million, with $16.9 million due in the next 12 months. The term loan requires repayment of principal at the end of each fiscal quarter, beginning with the fiscal quarter ended August 31, 2019. The principal repayment amounts are in accordance with the following schedule: (i) four payments of $1.9 million each, (ii) four payments of $3.8 million each, (iii) four payments of $5.6 million each, (iv) four payments of $7.5 million each, (v) three payments of $9.4 million each, and (vi) the last payment is of the remaining principal amount. Any amounts outstanding under the term loan thereafter would be due on the maturity date. The term loan may be prepaid before maturity in whole or in part at our option without penalty or premium. As of August 31, 2020, the carrying value of the term loan approximates the fair value, based on Level 2 inputs (observable market prices in less than active markets), as the interest rate is variable over the selected interest period and is similar to current rates at which we can borrow funds. Costs incurred to obtain our long-term debt of $1.6 million, along with $1.2 million of unamortized debt issuance costs related to the previous credit agreement, are recorded as debt issuance costs as a direct deduction from the carrying value of the debt liability on our condensed consolidated balance sheets as of August 31, 2020. These costs are being amortized over the term of the debt agreement using the effective interest rate method. Amortization expense related to the debt issuance costs was $0.1 million for each of the three months ended August 31, 2020 and August 31, 2019. Amortization expense related to the debt issuance costs was $0.4 million and $0.3 million for the nine months ended August 31, 2020 and August 31, 2019, respectively. These amounts are recorded in interest expense on our condensed consolidated statements of operations. Revolving loans may be borrowed, repaid, and reborrowed until April 30, 2024, at which time all amounts outstanding must be repaid. Accrued interest on the loans is payable quarterly in arrears with respect to base rate loans and at the end of each interest rate period (or at each three-month interval in the case of loans with interest periods greater than three months) with respect to Eurocurrency rate loans. We may prepay the loans or terminate or reduce the commitments in whole or in part at any time, without premium or penalty, subject to certain conditions and reimbursement of certain costs in the case of Eurocurrency rate loans. As of August 31, 2020, there were no amounts outstanding under the revolving line of credit and $1.9 million of letters of credit outstanding. On October 5, 2020, we completed the acquisition of Chef Software and funded the purchase price, in part, by drawing down $98.5 million under the revolving line of credit (Note 17). We are the sole borrower under the credit facility. Our obligations under the Credit Agreement are secured by substantially all of our assets and each of our material domestic subsidiaries, as well as 100% of the capital stock of our domestic subsidiaries and 65% of the capital stock of our first-tier foreign subsidiaries, in each case, subject to certain exceptions as described in the Credit Agreement. Future material domestic subsidiaries will be required to guaranty our obligations under the Credit Agreement, and to grant security interests in substantially all of their assets to secure such obligations. The Credit Agreement generally prohibits, with certain exceptions, any other liens on our assets, subject to certain exceptions as described in the Credit Agreement. The Credit Agreement contains customary affirmative and negative covenants, including covenants that limit or restrict our ability to, among other things, grant liens, make investments, make acquisitions, incur indebtedness, merge or consolidate, dispose of assets, pay dividends or make distributions, repurchase stock, change the nature of the business, enter into certain transactions with affiliates and enter into burdensome agreements, in each case subject to customary exceptions for a credit facility of this size and type. We are also required to maintain compliance with a consolidated fixed charge coverage ratio, a consolidated total leverage ratio and a consolidated senior secured leverage ratio. As of August 31, 2020, aggregate principal payments of long-term debt for the next five years are (in thousands): Remainder of 2020 $ 3,762 2021 18,813 2022 26,338 2023 33,863 2024 206,937 Total $ 289,713 |
Leases
Leases | 9 Months Ended |
Aug. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases In February 2016, the FASB issued ASC 842 to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The Company adopted ASC 842 on December 1, 2019 using the modified retrospective method and as a result did not adjust comparative periods or modify disclosures in those comparative periods. The new guidance provides a number of optional practical expedients in transition. The Company elected the package of practical expedients, which does not require the reassessment of prior conclusions about lease identification, lease classification and initial direct costs. Further, the Company elected the practical expedients to combine lease and non-lease components. Contracts may be comprised of lease components, non-lease components, and elements that are not components. Each lease component represents a lessee’s right to use an underlying asset in the contract if the lessee can benefit from the right-of-use of the asset either on its own or together with other readily available resources and if the right-of-use is neither highly dependent or highly interrelated with other rights-of-use. Non-lease components include items such as common area maintenance and utilities provided by the lessor. We also elected the practical expedient to not recognize right-of-use assets and lease liabilities for short-term leases. Leases with an initial term of 12 months or less are classified as short-term leases. Consideration in the contract is comprised of any fixed payments and variable payments that depend on an index or rate. Payments in the Company's operating lease arrangements primarily consist of base office rent. In accordance with ASC 842, variable payments in an agreement that are not dependent on an index or rate are excluded from the calculation of ROU assets and lease liabilities. The Company makes variable payments on certain of its leases related to taxes, insurance, common area maintenance, and utilities, among other things. The adoption of ASC 842 on December 1, 2019 resulted in the recognition of operating lease ROU assets of approximately $28.9 million and operating lease liabilities of approximately $29.9 million. The difference between the value of the ROU assets and lease liabilities is due to the reclassification of existing deferred rent, prepaid rent, and unamortized lease incentives as of December 1, 2019. Operating leases are included in ROU assets and lease liabilities on the Company’s balance sheets. ROU assets and lease liabilities are to be presented separately for operating and finance leases; however, the Company currently has no material finance leases. The adoption of ASC 842 did not have a material impact on the Company’s condensed consolidated statement of operations, consolidated statement of stockholders' equity, consolidated statement of comprehensive income (loss) or consolidated statement of cash flows. The adoption of ASC 842 had no impact on liquidity or the Company’s debt-covenant compliance under its current debt agreements. The Company determines if an arrangement is a lease at inception. ROU assets represent the Company’s right to use an underlying asset for the duration of the lease term. Lease liabilities represent the Company’s contractual obligation to make lease payments over the lease term. ROU assets are recorded and recognized at commencement for the lease liability amount, plus initial direct costs incurred less lease incentives received. Lease liabilities are recorded at the present value of future lease payments over the lease term at commencement. Operating leases liabilities and their corresponding ROU assets are recorded based on the present value of lease payments over the expected lease term. The interest rate implicit in the lease contracts is not readily determinable. As such, we utilize the appropriate incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term at an amount equal to the lease payments in a similar economic environment. Lease expenses relating to operating leases are recognized on a straight-line basis over the lease term. The Company has operating leases for administrative, product development, and sales and marketing facilities, vehicles, and equipment under various non-cancelable lease agreements. The Company’s leases have remaining lease terms ranging from 1 year to 10 years. The Company’s lease terms may include options to extend or terminate the lease where it is reasonably certain that the Company will exercise those options. The Company considers several economic factors when making the determination as to whether the Company will exercise options to extend or terminate the lease, including but not limited to, the significance of leasehold improvements incurred in the office space, the difficulty in replacing the asset, underlying contractual obligations, or specific characteristics unique to a particular lease. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The components of operating lease cost for the three and nine months ended August 31, 2020 were as follows (in thousands): Three Months Ended Nine Months Ended August 31, 2020 August 31, 2020 Lease costs under long-term operating leases $ 1,714 $ 5,471 Lease costs under short-term operating leases 235 379 Variable lease cost under short-term and long-term operating leases (1) 113 301 Operating lease right-of-use asset impairment — 1,189 Total operating lease cost $ 2,062 $ 7,340 (1) Lease costs that are not fixed at lease commencement. The table below presents supplemental cash flow information related to leases during the nine months ended August 31, 2020 (in thousands): Nine Months Ended August 31, 2020 Cash paid for leases $ 5,979 Right-of-use assets recognized for new leases and amendments (non-cash) $ 204 Weighted average remaining lease term in years and weighted average discount rate are as follows: August 31, 2020 Weighted average remaining lease term in years 4.51 Weighted average discount rate 2.3 % Future payments under non-cancellable leases at August 31, 2020 are as follows (in thousands): Remainder of 2020 $ 1,906 2021 6,267 2022 5,518 2023 5,325 2024 5,236 Thereafter 2,841 Total lease payments 27,093 Less imputed interest (1) (1,380) Present value of lease liabilities $ 25,713 (1) Lease liabilities are measured at the present value of the remaining lease payments using a discount rate determined at lease commencement unless the discount rate is updated as a result of a lease reassessment event. As previously disclosed in the Company’s 2019 10-K, the following table summarizes the future non-cancelable minimum lease commitments (including office space, copiers, and automobiles) at November 30, 2019 under the previous lease accounting standard, ASC 840, Leases (in thousands): 2020 $ 7,453 2021 5,711 2022 4,977 2023 5,017 2024 5,102 Thereafter 2,904 Total $ 31,164 |
Common Stock Repurchases
Common Stock Repurchases | 9 Months Ended |
Aug. 31, 2020 | |
Equity [Abstract] | |
Common Stock Repurchases | Common Stock RepurchasesIn January 2020, our Board of Directors increased the total share repurchase authorization from $75 million to $250 million. In the three months ended August 31, 2020 and August 31, 2019, we did not repurchase and retire any shares of our common stock. In the nine months ended August 31, 2020 and August 31, 2019, we repurchased and retired 0.4 million shares for $20 million and 0.7 million shares for $25 million, respectively. The shares were repurchased in both periods as part of our Board of Directors authorized share repurchase program. As of August 31, 2020, there was $230 million remaining under the current authorization. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Aug. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense reflects the fair value of stock-based awards, less the present value of expected dividends when applicable, measured at the grant date and recognized over the relevant service period. We estimate the fair value of each stock-based award on the measurement date using the current market price of the stock, the Black-Scholes option valuation model, or the Monte Carlo Simulation valuation model. During the first nine months of fiscal years 2018, 2019 and 2020, we granted performance-based restricted stock units that include two performance metrics under our Long-Term Incentive Plan ("LTIP") where the performance measurement period is three years. Vesting of the LTIP awards is as follows: (i) 50% is based on our level of attainment of specified total stockholder return ("TSR") targets relative to the percentage appreciation of a specified index of companies for the respective three-year periods, and (ii) 50% is based on achievement of a three-year cumulative performance condition (operating income). In order to estimate the fair value of such awards, we used a Monte Carlo Simulation valuation model for the market condition portion of the award, and used the closing price of our common stock on the date of grant, less the present value of expected dividends when applicable, for the portion related to the performance condition. The Black-Scholes and Monte Carlo Simulation valuation models incorporate assumptions as to stock price volatility, the expected life of options or awards, a risk-free interest rate and dividend yield. We recognize stock-based compensation expense related to options and restricted stock units on a straight-line basis over the service period of the award, which is generally 4 years for options and 3 years for restricted stock units. We recognize stock-based compensation expense related to our employee stock purchase plan using an accelerated attribution method. The following table provides the classification of stock-based compensation as reflected on our condensed consolidated statements of operations (in thousands): Three Months Ended Nine Months Ended August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Cost of maintenance and services $ 322 $ 317 $ 979 $ 811 Sales and marketing 1,035 968 3,195 3,205 Product development 1,693 1,529 5,518 5,393 General and administrative 2,635 2,676 7,667 8,002 Total stock-based compensation $ 5,685 $ 5,490 $ 17,359 $ 17,411 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Aug. 31, 2020 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss The following table summarizes the changes in accumulated balances of other comprehensive loss during the nine months ended August 31, 2020 (in thousands): Foreign Currency Translation Adjustment Unrealized (Losses) Gains on Investments Unrealized Losses on Hedging Activity Accumulated Other Comprehensive Loss Balance, December 1, 2019 $ (28,393) $ (30) $ (1,551) $ (29,974) Other comprehensive income (loss) before reclassifications, net of tax 374 105 (4,106) (3,627) Balance, August 31, 2020 $ (28,019) $ 75 $ (5,657) $ (33,601) The tax effect on accumulated unrealized losses on hedging activity and unrealized (losses) gains on investments was $1.7 million and $0.4 million as of August 31, 2020 and November 30, 2019, respectively. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Aug. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Contract Balances Unbilled Receivables and Contract Assets The timing of revenue recognition may differ from the timing of customer invoicing. When revenue is recognized prior to invoicing and the right to the amount due from customers is conditioned only on the passage of time, we record an unbilled receivable on our condensed consolidated balance sheets. Our multi-year term license arrangements, which are typically billed annually, result in revenue recognition in advance of invoicing and the recognition of unbilled receivables. As of August 31, 2020, invoicing of our long-term unbilled receivables is expected to occur as follows (in thousands): 2021 $ 6,694 2022 1,866 2023 180 Total $ 8,740 Contract assets, which arise when revenue is recognized prior to invoicing and the right to the amount due from customers is conditioned on something other than the passage of time, such as the completion of a related performance obligation, were $1.2 million as of August 31, 2020 and $4.0 million as of November 30, 2019. These amounts are included in unbilled receivables or long-term unbilled receivables on our condensed consolidated balance sheets. Deferred Revenue Deferred revenue is recorded when revenue is recognized subsequent to customer invoicing. Our deferred revenue balance is primarily made up of deferred maintenance from our OpenEdge and Application Development and Deployment segments. As of August 31, 2020, the changes in deferred revenue were as follows (in thousands): Balance, December 1, 2019 $ 177,246 Billings and other 313,875 Revenue recognized (319,765) Balance, August 31, 2020 $ 171,356 Transaction price allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. As of August 31, 2020, transaction price allocated to remaining performance obligations was $175 million. We expect to recognize approximately 88% of the revenue within the next year and the remainder thereafter. Deferred Contract Costs Deferred contract costs, which include certain sales incentive programs, are incremental and recoverable costs of obtaining a contract with a customer. Incremental costs of obtaining a contract with a customer are recognized as an asset if the expected benefit of those costs is longer than one year. We have applied the practical expedient to expense costs as incurred for costs to obtain a contract with a customer when the amortization period would have been one year or less. These costs include a large majority of our sales incentive programs as we have determined that annual compensation is commensurate with annual sales activities. Certain of our sales incentive programs meet the requirements to be capitalized. Depending upon the sales incentive program and the related revenue arrangement, such capitalized costs are amortized over the longer of (i) the product life, which is generally three three |
Restructuring Charges
Restructuring Charges | 9 Months Ended |
Aug. 31, 2020 | |
Restructuring Charges [Abstract] | |
Restructuring Charges | Restructuring Charges The following table provides a summary of activity for our restructuring actions, which are detailed further below (in thousands): Excess Facilities and Other Costs Employee Severance and Related Benefits Total Balance, December 1, 2019 $ 196 $ 2,007 $ 2,203 Costs incurred 1,678 148 1,826 Cash disbursements (1,148) (1,983) (3,131) Translation adjustments and other (16) — (16) Balance, August 31, 2020 $ 710 $ 172 $ 882 During the fourth quarter of fiscal year 2019, we announced the reduction of our ongoing spending level within our cognitive application product lines, which consist primarily of our DataRPM and Kinvey products. This restructuring resulted in a reduction in positions primarily within the product development function. In connection with this restructuring action, during the fourth quarter of fiscal year 2019, we evaluated the ongoing value of the intangible assets primarily associated with the technologies and trade names obtained in the acquisitions of DataRPM and Kinvey. Restructuring expenses are related to employee costs, including severance, health benefits and outplacement services (but excluding stock-based compensation). We did not incur any expenses related to this restructuring in the three months ended August 31, 2020. For the nine months ended August 31, 2020, we incurred expenses of $0.1 million related to this restructuring. The expenses are recorded as restructuring expenses in the condensed consolidated statements of operations. A summary of activity for this restructuring action is as follows (in thousands): Excess Facilities and Other Costs Employee Severance and Related Benefits Total Balance, December 1, 2019 $ — $ 1,460 $ 1,460 Costs incurred — 109 109 Cash disbursements — (1,404) (1,404) Balance, August 31, 2020 $ — $ 165 $ 165 Cash disbursements for expenses incurred to date under this restructuring are expected to be made through fiscal year 2020. Accordingly, the balance of the restructuring reserve of $0.2 million is included in other accrued liabilities on the condensed consolidated balance sheet at August 31, 2020. We do not expect to incur additional material costs with respect to this restructuring. During the second quarter of fiscal year 2019, we restructured our operations in connection with the acquisition of Ipswitch (Note 6). This restructuring resulted in a reduction in redundant positions, primarily within administrative functions of Ipswitch. We expect to incur additional expenses as part of this action related to employee costs and facility closures as we consolidate offices in various locations during fiscal year 2020, but we do not expect these costs to be material. Costs incurred related to this restructuring event were minimal during the three months ended August 31, 2020. For the nine months ended August 31, 2020, we incurred expenses of $1.4 million related to this restructuring. The expenses are recorded in restructuring expense on the condensed consolidated statements of operations and include charges for the impairment of operating lease right-of-use assets of $1.2 million for the nine months ended August 31, 2020 (Note 8). A summary of activity for this restructuring action is as follows (in thousands): Excess Facilities and Other Costs Employee Severance and Related Benefits Total Balance, December 1, 2019 $ 5 $ 547 $ 552 Costs incurred 1,409 39 1,448 Cash disbursements (747) (579) (1,326) Translation adjustments and other (15) — (15) Balance, August 31, 2020 $ 652 $ 7 $ 659 Cash disbursements for expenses incurred to date under this restructuring are expected to be made through fiscal year 2020. Accordingly, the balance of the restructuring reserve of $0.7 million is included in short-term operating lease liabilities on the condensed consolidated balance sheet at August 31, 2020. |
Income Taxes
Income Taxes | 9 Months Ended |
Aug. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our income tax provision for the third quarter of fiscal years 2020 and 2019 reflects our estimate of the effective tax rates expected to be applicable for the full fiscal years, adjusted for any discrete events, which are recorded in the period in which they occur. The estimates are reevaluated each quarter based on our estimated tax expense for the full fiscal year. Our effective tax rate was 21% in the third fiscal quarter of 2020 compared to (11)% in the third fiscal quarter of 2019. Our effective tax rate was 22% in the nine month period ended August 31, 2020 compared to 18% in the same period of 2019.The primary reason for the increase in the effective rate is that during the preparation of our financial statements for the three months ended August 31, 2019, we identified an error in our income tax provisions for the first and second quarters of fiscal year 2019 related to the tax treatment of an intercompany sale of intellectual property that occurred in fiscal year 2018. As a result of the error, income tax expense was overstated by $1.1 million and $2.5 million during the first and second quarters of fiscal year 2019, respectively. We determined that the error was not material to the first and second quarters of fiscal year 2019 and corrected the error by recording an out of period $3.6 million tax benefit in our financial statements for the period ended August 31, 2019. If the error had not occurred, the effective tax rate in the third quarter of fiscal year 2019 would have been 18%. Our federal income tax returns have been examined or are closed by statute for all years prior to fiscal year 2017. Our state income tax returns have been examined or are closed by statute for all years prior to fiscal year 2015. Tax authorities for certain non-U.S. jurisdictions are also examining returns. With some exceptions, we are generally not subject to tax examinations in non-U.S. jurisdictions for years prior to fiscal year 2013. |
Earnings per share
Earnings per share | 9 Months Ended |
Aug. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per share | Earnings per share We compute basic earnings per share using the weighted average number of common shares outstanding. We compute diluted earnings per share using the weighted average number of common shares outstanding plus the effect of outstanding dilutive stock options, restricted stock units and deferred stock units, using the treasury stock method. The following table sets forth the calculation of basic and diluted earnings per share on an interim basis (in thousands, except per share data): Three Months Ended Nine Months Ended August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Net income $ 23,977 $ 13,557 $ 62,061 $ 31,140 Weighted average shares outstanding 45,036 44,716 44,941 44,761 Dilutive impact from common stock equivalents 328 587 441 531 Diluted weighted average shares outstanding 45,364 45,303 45,382 45,292 Basic earnings per share $ 0.53 $ 0.30 $ 1.38 $ 0.70 Diluted earnings per share $ 0.53 $ 0.30 $ 1.37 $ 0.69 We excluded stock awards representing approximately 1,450,000 shares and 1,216,000 shares of common stock from the calculation of diluted earnings per share in the three and nine months ended August 31, 2020, respectively, because these awards were anti-dilutive. In the three and nine months ended August 31, 2019, we excluded stock awards representing 1,236,000 shares and 898,000 shares of common stock, respectively, from the calculation of diluted earnings per share as they were anti-dilutive. |
Business Segments and Internati
Business Segments and International Operations | 9 Months Ended |
Aug. 31, 2020 | |
Segment Reporting [Abstract] | |
Business Segments and International Operations | Business Segments and International Operations Operating segments are components of an enterprise that engage in business activities for which discrete financial information is available and regularly reviewed by the chief operating decision maker in deciding how to allocate resources and assess performance. Our chief operating decision maker is our Chief Executive Officer. We operate as three distinct business segments: OpenEdge, Data Connectivity and Integration, and Application Development and Deployment. We do not manage our assets or capital expenditures by segment or assign other income (expense) and income taxes to segments. We manage and report such items on a consolidated company basis. The following table provides revenue and contribution margin from our reportable segments and reconciles to our consolidated income from continuing operations before income taxes: Three Months Ended Nine Months Ended (In thousands) August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Segment revenue: OpenEdge $ 85,794 $ 78,607 $ 240,608 $ 211,679 Data Connectivity and Integration 4,468 8,754 21,815 27,686 Application Development and Deployment 19,437 19,355 57,342 56,895 Total revenue 109,699 106,716 319,765 296,260 Segment costs of revenue and operating expenses: OpenEdge 18,358 22,711 55,984 60,123 Data Connectivity and Integration 1,931 1,943 6,240 5,249 Application Development and Deployment 7,298 6,093 21,572 17,067 Total costs of revenue and operating expenses 27,587 30,747 83,796 82,439 Segment contribution margin: OpenEdge 67,436 55,896 184,624 151,556 Data Connectivity and Integration 2,537 6,811 15,575 22,437 Application Development and Deployment 12,139 13,262 35,770 39,828 Total contribution margin 82,112 75,969 235,969 213,821 Other unallocated expenses (1) 48,919 60,009 146,755 167,711 Income from operations 33,193 15,960 89,214 46,110 Other expense, net (2,962) (3,718) (9,206) (8,038) Income before income taxes $ 30,231 $ 12,242 $ 80,008 $ 38,072 (1) The following expenses are not allocated to our segments as we manage and report our business in these functional areas on a consolidated basis only: certain product development and corporate sales and marketing expenses, customer support, administration, amortization of acquired intangibles, stock-based compensation, restructuring, and acquisition-related expenses. Our revenues are derived from licensing our products, and from related services, which consist of maintenance, hosting services, and consulting and education. Information relating to revenue from external customers by revenue type is as follows (in thousands): Three Months Ended Nine Months Ended (In thousands) August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Performance obligations transferred at a point in time: Software licenses $ 27,514 $ 30,686 $ 77,806 $ 83,216 Performance obligations transferred over time: Maintenance 72,764 67,611 214,506 190,138 Services 9,421 8,419 27,453 22,906 Total revenue $ 109,699 $ 106,716 $ 319,765 $ 296,260 In the following table, revenue attributed to North America includes sales to customers in the U.S. and sales to certain multinational organizations. Revenue from EMEA, Latin America and the Asia Pacific region includes sales to customers in each region plus sales from the U.S. to distributors in these regions. Information relating to revenue from external customers from different geographical areas is as follows (in thousands): Three Months Ended Nine Months Ended (In thousands) August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 North America $ 62,927 $ 60,208 $ 184,904 $ 163,766 EMEA 37,447 35,109 106,592 102,114 Latin America 3,547 5,470 10,893 14,039 Asia Pacific 5,778 5,929 17,376 16,341 Total revenue $ 109,699 $ 106,716 $ 319,765 $ 296,260 No single customer, partner, or country outside of the U.S. has accounted for more than 10% of our total revenue for the three or nine months ended August 31, 2020 and August 31, 2019. As of August 31, 2020 and November 30, 2019, no individual customer accounted for 10% or more of our net accounts receivable balance. As of August 31, 2020 and November 30, 2019, no individual foreign country accounted for 10% or more of total consolidated assets. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Aug. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsOn October 5, 2020, we completed the acquisition of Chef Software for $220 million in cash, subject to customary adjustments. The acquisition was funded with existing cash on hand and borrowings under our existing credit facility. Chef provides complete infrastructure automation to build, deploy, manage and secure applications in modern multi-cloud and hybrid environments, as well as on-premises. Results of operations for Chef will be included in our consolidated financial statements as part of the Application Development and Deployment business segment from the date of acquisition. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Aug. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies - We prepared the accompanying unaudited condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") regarding interim financial reporting. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America ("GAAP") for complete financial statements and these unaudited financial statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2019 ("2019 10-K"). We made no material changes in the application of our significant accounting policies that were disclosed in our 2019 10-K. We have prepared the accompanying unaudited condensed consolidated financial statements on the same basis as the audited financial statements included in our 2019 10-K, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full fiscal year. |
Use of Estimates | Use of Estimates The preparation of financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an on-going basis, management evaluates its estimates and records changes in estimates in the period in which they become known. These estimates are based on historical data and experience, as well as various other assumptions that management believes to be reasonable under the circumstances. The most significant estimates relate to: the timing and amount of revenue recognition, including the determination of the nature and timing of the satisfaction of performance obligations, the standalone selling price of performance obligations, and the transaction price allocated to performance obligations; the realization of tax assets and estimates of tax liabilities; fair values of investments in marketable securities; assets held for sale; intangible assets and goodwill valuations; the recognition and disclosure of contingent liabilities; the collectability of accounts receivable; and assumptions used to determine the fair value of stock-based compensation. Actual results could differ from those estimates. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In August 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12"). ASU 2017-12 intends to better align an entity's risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. We adopted this standard at the beginning of the first quarter of fiscal year 2020; however, our existing accounting aligned with the guidance of ASU 2017-12 and therefore there was no impact to our financial statements from adoption. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASC 842"). ASC 842 supersedes the requirements in Topic 840, Leases , and requires lessees to recognize right-of-use ("ROU") assets and liabilities for leases with lease terms of more than twelve months. ASC 842 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2018. We adopted ASC 842 effective December 1, 2019 using the modified retrospective transition method of applying the new standard at the adoption date. Results for reporting periods beginning on or after December 1, 2019 are presented under the new guidance, while prior period amounts have not been adjusted and continue to be reported in accordance with previous guidance. Disclosures required under the new standard will not be provided for dates and periods before December 1, 2019. The new standard provided a number of optional practical expedients in transition. We elected the transition package of practical expedients available in the standard, which allowed the carry forward of historical assessments of whether a contract contains a lease, lease classification and initial direct costs. We also elected the practical expedient provided in ASC 842 to not separate lease components from non-lease components for each material underlying asset class: office leases, vehicle leases and equipment leases. For each lease, the non-lease components and related lease components are accounted for as a single lease component. Items or activities that do not transfer goods or services to the lessee, such as administrative tasks to set up the contract and reimbursement or payment of lessor costs, are not components of the contract and therefore no contract consideration is allocated to such items or activities. We did not elect the hindsight practical expedient to determine the lease term for existing leases. The adoption of the new standard also resulted in significant additional disclosures regarding our leasing activities. Refer to Note 8 for further details. Recently Issued Accounting Pronouncements Not Yet Adopted In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles - Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 amends Topic 350 to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. This update requires the performance of an annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. However, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The guidance in ASU 2017-04 is required for annual reporting periods beginning after December 15, 2019, with early adoption permitted. Upon adoption, we do not expect this update to have a material effect on our consolidated financial position and results of operations. In June 2016, the FASB issued Accounting Standards Update No. 2016-13, Financial Instruments - Credit Losses (Topic 326) ("ASU 2016-13"). ASU 2016-13 changes the impairment model for most financial assets and certain other instruments. Entities will be required to use a model that will result in the earlier recognition of allowances for losses for trade and other receivables, contract assets, held-to-maturity debt securities, loans, and other instruments. ASU 2016-13 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted. We are currently evaluating the impact of ASU 2016-13 on our consolidated financial statements. |
Cash, Cash Equivalents and In_2
Cash, Cash Equivalents and Investments (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Investments and Cash [Abstract] | |
Summary of Cash, Cash Equivalents and Available-for-sale Investments | A summary of our cash, cash equivalents and available-for-sale investments at August 31, 2020 is as follows (in thousands): Amortized Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash $ 214,037 $ — $ — $ 214,037 Money market funds 6,538 — — 6,538 U.S. treasury bonds 4,994 75 — 5,069 Corporate bonds 4,419 56 — 4,475 Total $ 229,988 $ 131 $ — $ 230,119 A summary of our cash, cash equivalents and available-for-sale investments at November 30, 2019 is as follows (in thousands): Amortized Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash $ 144,346 $ — $ — $ 144,346 Money market funds 9,913 — — 9,913 State and municipal bond obligations 7,036 1 — 7,037 U.S. treasury bonds 7,221 10 — 7,231 Corporate bonds 5,146 12 — 5,158 Total $ 173,662 $ 23 $ — $ 173,685 |
Summary of Cash, Cash Equivalents and Available-for-sale Investments by Balance Sheet Classification | Such amounts are classified on our condensed consolidated balance sheets as follows (in thousands): August 31, 2020 November 30, 2019 Cash and Equivalents Short-Term Investments Cash and Equivalents Short-Term Investments Cash $ 214,037 $ — $ 144,346 $ — Money market funds 6,538 — 9,913 — State and municipal bond obligations — — — 7,037 U.S. treasury bonds — 5,069 — 7,231 Corporate bonds — 4,475 — 5,158 Total $ 220,575 $ 9,544 $ 154,259 $ 19,426 |
Fair Value of Debt Securities by Contractual Maturity | The fair value of debt securities by contractual maturity is as follows (in thousands): August 31, 2020 November 30, 2019 Due in one year or less $ 5,703 $ 14,004 Due after one year (1) 3,841 5,422 Total $ 9,544 $ 19,426 (1) Includes U.S. treasury bonds and corporate bonds, which are securities representing investments available for current operations and are classified as current on the condensed consolidated balance sheets. |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Outstanding Foreign Currency Forward Contracts | The following table presents our interest rate swap contract where the notional amount reflects the quarterly amortization of the interest rate swap, which is equal to approximately one-half of the corresponding reduction in the balance of our term loan as we make scheduled principal payments. The fair value of the derivative represents the discounted value of the expected future discounted cash flows for the interest rate swap, based on the amortization schedule and the current forward curve for the remaining term of the contract, as of the date of each reporting period (in thousands): August 31, 2020 November 30, 2019 Notional Value Fair Value Notional Value Fair Value Interest rate swap contracts designated as cash flow hedges $ 144,375 $ (7,462) $ 148,125 $ (2,054) The table below details outstanding foreign currency forward contracts where the notional amount is determined using contract exchange rates (in thousands): August 31, 2020 November 30, 2019 Notional Value Fair Value Notional Value Fair Value Forward contracts to sell U.S. dollars $ 70,358 $ 1,915 $ 66,951 $ (85) Forward contracts to purchase U.S. dollars — — 1,457 5 Total $ 70,358 $ 1,915 $ 68,408 $ (80) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements within the Fair Value Hierarchy of the Financial Assets | The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at August 31, 2020 (in thousands): Fair Value Measurements Using Total Fair Value Level 1 Level 2 Level 3 Assets Money market funds $ 6,538 $ 6,538 $ — $ — U.S. treasury bonds 5,069 — 5,069 — Corporate bonds 4,475 — 4,475 — Foreign exchange derivatives 1,915 — 1,915 — Liabilities Interest rate swap $ (7,462) $ — $ (7,462) $ — The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at November 30, 2019 (in thousands): Fair Value Measurements Using Total Fair Value Level 1 Level 2 Level 3 Assets Money market funds $ 9,913 $ 9,913 $ — $ — State and municipal bond obligations 7,037 — 7,037 — U.S. treasury bonds 7,231 — 7,231 — Corporate bonds 5,158 — 5,158 — Liabilities Foreign exchange derivatives (80) — (80) — Interest rate swap $ (2,054) $ — $ (2,054) $ — |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | Intangible assets are comprised of the following significant classes (in thousands): August 31, 2020 November 30, 2019 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value Purchased technology $ 135,186 $ (110,941) $ 24,245 $ 135,186 $ (105,967) $ 29,219 Customer-related 134,042 (84,624) 49,418 134,042 (74,175) 59,867 Trademarks and trade names 24,740 (17,577) 7,163 24,740 (16,043) 8,697 Non-compete agreement 2,000 (892) 1,108 2,000 (391) 1,609 Total $ 295,968 $ (214,034) $ 81,934 $ 295,968 $ (196,576) $ 99,392 |
Schedule of Future Amortization Expense from Intangible Assets Held | Future amortization expense for intangible assets as of August 31, 2020, is as follows (in thousands): Remainder of 2020 $ 5,777 2021 23,117 2022 22,136 2023 21,860 2024 9,044 Total $ 81,934 |
Schedule of Goodwill | Changes in the carrying amount of goodwill in the nine months ended August 31, 2020 are as follows (in thousands): Balance, November 30, 2019 $ 432,824 Measurement period adjustments (1) (838) Translation adjustments (122) Balance, August 31, 2020 $ 431,864 (1) Represents final measurement period adjustments related to our Ipswitch acquisition (Note 6) Changes in the goodwill balances by reportable segment in the nine months ended August 31, 2020 are as follows (in thousands): November 30, 2019 Measurement Period Adjustments Translation adjustments August 31, 2020 OpenEdge $ 366,819 $ (838) $ (122) $ 365,859 Data Connectivity and Integration 19,040 — — 19,040 Application Development and Deployment 46,965 — — 46,965 Total goodwill $ 432,824 $ (838) $ (122) $ 431,864 |
Business Combinations (Tables)
Business Combinations (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The following table discloses the net assets acquired in the business combination (in thousands): Initial Purchase Price Allocation Measurement Period Adjustments Final Purchase Price Allocation Life Net working capital $ 6,068 $ 651 $ 6,719 Property, plant and equipment 4,661 4,661 Purchased technology 33,100 33,100 5 years Trade name 9,600 9,600 5 years Customer relationships 66,600 66,600 5 years Other assets 314 (4) 310 Deferred revenue (12,696) (29) (12,725) Goodwill 117,651 (618) 117,033 Net assets acquired $ 225,298 $ — $ 225,298 |
Business Acquisition, Pro Forma Information | (In thousands, except per share data) Pro Forma Revenue $ 325,248 Net income $ 24,381 Net income per basic share $ 0.54 Net income per diluted share $ 0.54 |
Term Loan and Line of Credit (T
Term Loan and Line of Credit (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Line of Credit Facility [Abstract] | |
Schedule of Maturities of Long-term Debt | As of August 31, 2020, aggregate principal payments of long-term debt for the next five years are (in thousands): Remainder of 2020 $ 3,762 2021 18,813 2022 26,338 2023 33,863 2024 206,937 Total $ 289,713 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Leases [Abstract] | |
Lease, Cost | The components of operating lease cost for the three and nine months ended August 31, 2020 were as follows (in thousands): Three Months Ended Nine Months Ended August 31, 2020 August 31, 2020 Lease costs under long-term operating leases $ 1,714 $ 5,471 Lease costs under short-term operating leases 235 379 Variable lease cost under short-term and long-term operating leases (1) 113 301 Operating lease right-of-use asset impairment — 1,189 Total operating lease cost $ 2,062 $ 7,340 (1) Lease costs that are not fixed at lease commencement. The table below presents supplemental cash flow information related to leases during the nine months ended August 31, 2020 (in thousands): Nine Months Ended August 31, 2020 Cash paid for leases $ 5,979 Right-of-use assets recognized for new leases and amendments (non-cash) $ 204 Weighted average remaining lease term in years and weighted average discount rate are as follows: August 31, 2020 Weighted average remaining lease term in years 4.51 Weighted average discount rate 2.3 % |
Lessee, Operating Lease, Liability, Maturity | Future payments under non-cancellable leases at August 31, 2020 are as follows (in thousands): Remainder of 2020 $ 1,906 2021 6,267 2022 5,518 2023 5,325 2024 5,236 Thereafter 2,841 Total lease payments 27,093 Less imputed interest (1) (1,380) Present value of lease liabilities $ 25,713 (1) Lease liabilities are measured at the present value of the remaining lease payments using a discount rate determined at lease commencement unless the discount rate is updated as a result of a lease reassessment event. |
Schedule of Future Minimum Rental Payments for Operating Leases | As previously disclosed in the Company’s 2019 10-K, the following table summarizes the future non-cancelable minimum lease commitments (including office space, copiers, and automobiles) at November 30, 2019 under the previous lease accounting standard, ASC 840, Leases (in thousands): 2020 $ 7,453 2021 5,711 2022 4,977 2023 5,017 2024 5,102 Thereafter 2,904 Total $ 31,164 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Classification of Stock-Based Compensation | The following table provides the classification of stock-based compensation as reflected on our condensed consolidated statements of operations (in thousands): Three Months Ended Nine Months Ended August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Cost of maintenance and services $ 322 $ 317 $ 979 $ 811 Sales and marketing 1,035 968 3,195 3,205 Product development 1,693 1,529 5,518 5,393 General and administrative 2,635 2,676 7,667 8,002 Total stock-based compensation $ 5,685 $ 5,490 $ 17,359 $ 17,411 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Loss | The following table summarizes the changes in accumulated balances of other comprehensive loss during the nine months ended August 31, 2020 (in thousands): Foreign Currency Translation Adjustment Unrealized (Losses) Gains on Investments Unrealized Losses on Hedging Activity Accumulated Other Comprehensive Loss Balance, December 1, 2019 $ (28,393) $ (30) $ (1,551) $ (29,974) Other comprehensive income (loss) before reclassifications, net of tax 374 105 (4,106) (3,627) Balance, August 31, 2020 $ (28,019) $ 75 $ (5,657) $ (33,601) |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Contract with Customer, Asset and Liability | As of August 31, 2020, invoicing of our long-term unbilled receivables is expected to occur as follows (in thousands): 2021 $ 6,694 2022 1,866 2023 180 Total $ 8,740 As of August 31, 2020, the changes in deferred revenue were as follows (in thousands): Balance, December 1, 2019 $ 177,246 Billings and other 313,875 Revenue recognized (319,765) Balance, August 31, 2020 $ 171,356 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Restructuring Charges [Abstract] | |
Summary of Restructuring Activity | The following table provides a summary of activity for our restructuring actions, which are detailed further below (in thousands): Excess Facilities and Other Costs Employee Severance and Related Benefits Total Balance, December 1, 2019 $ 196 $ 2,007 $ 2,203 Costs incurred 1,678 148 1,826 Cash disbursements (1,148) (1,983) (3,131) Translation adjustments and other (16) — (16) Balance, August 31, 2020 $ 710 $ 172 $ 882 A summary of activity for this restructuring action is as follows (in thousands): Excess Facilities and Other Costs Employee Severance and Related Benefits Total Balance, December 1, 2019 $ — $ 1,460 $ 1,460 Costs incurred — 109 109 Cash disbursements — (1,404) (1,404) Balance, August 31, 2020 $ — $ 165 $ 165 A summary of activity for this restructuring action is as follows (in thousands): Excess Facilities and Other Costs Employee Severance and Related Benefits Total Balance, December 1, 2019 $ 5 $ 547 $ 552 Costs incurred 1,409 39 1,448 Cash disbursements (747) (579) (1,326) Translation adjustments and other (15) — (15) Balance, August 31, 2020 $ 652 $ 7 $ 659 |
Earnings per share (Tables)
Earnings per share (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Earnings Per Share [Abstract] | |
Calculation of Basic and Diluted Earnings Per Share | The following table sets forth the calculation of basic and diluted earnings per share on an interim basis (in thousands, except per share data): Three Months Ended Nine Months Ended August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Net income $ 23,977 $ 13,557 $ 62,061 $ 31,140 Weighted average shares outstanding 45,036 44,716 44,941 44,761 Dilutive impact from common stock equivalents 328 587 441 531 Diluted weighted average shares outstanding 45,364 45,303 45,382 45,292 Basic earnings per share $ 0.53 $ 0.30 $ 1.38 $ 0.70 Diluted earnings per share $ 0.53 $ 0.30 $ 1.37 $ 0.69 |
Business Segments and Interna_2
Business Segments and International Operations (Tables) | 9 Months Ended |
Aug. 31, 2020 | |
Segment Reporting [Abstract] | |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | The following table provides revenue and contribution margin from our reportable segments and reconciles to our consolidated income from continuing operations before income taxes: Three Months Ended Nine Months Ended (In thousands) August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Segment revenue: OpenEdge $ 85,794 $ 78,607 $ 240,608 $ 211,679 Data Connectivity and Integration 4,468 8,754 21,815 27,686 Application Development and Deployment 19,437 19,355 57,342 56,895 Total revenue 109,699 106,716 319,765 296,260 Segment costs of revenue and operating expenses: OpenEdge 18,358 22,711 55,984 60,123 Data Connectivity and Integration 1,931 1,943 6,240 5,249 Application Development and Deployment 7,298 6,093 21,572 17,067 Total costs of revenue and operating expenses 27,587 30,747 83,796 82,439 Segment contribution margin: OpenEdge 67,436 55,896 184,624 151,556 Data Connectivity and Integration 2,537 6,811 15,575 22,437 Application Development and Deployment 12,139 13,262 35,770 39,828 Total contribution margin 82,112 75,969 235,969 213,821 Other unallocated expenses (1) 48,919 60,009 146,755 167,711 Income from operations 33,193 15,960 89,214 46,110 Other expense, net (2,962) (3,718) (9,206) (8,038) Income before income taxes $ 30,231 $ 12,242 $ 80,008 $ 38,072 (1) The following expenses are not allocated to our segments as we manage and report our business in these functional areas on a consolidated basis only: certain product development and corporate sales and marketing expenses, customer support, administration, amortization of acquired intangibles, stock-based compensation, restructuring, and acquisition-related expenses. |
Revenue from External Customers by Products and Services | Our revenues are derived from licensing our products, and from related services, which consist of maintenance, hosting services, and consulting and education. Information relating to revenue from external customers by revenue type is as follows (in thousands): Three Months Ended Nine Months Ended (In thousands) August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Performance obligations transferred at a point in time: Software licenses $ 27,514 $ 30,686 $ 77,806 $ 83,216 Performance obligations transferred over time: Maintenance 72,764 67,611 214,506 190,138 Services 9,421 8,419 27,453 22,906 Total revenue $ 109,699 $ 106,716 $ 319,765 $ 296,260 |
Revenue from External Customers from Different Geographical Areas | In the following table, revenue attributed to North America includes sales to customers in the U.S. and sales to certain multinational organizations. Revenue from EMEA, Latin America and the Asia Pacific region includes sales to customers in each region plus sales from the U.S. to distributors in these regions. Information relating to revenue from external customers from different geographical areas is as follows (in thousands): Three Months Ended Nine Months Ended (In thousands) August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 North America $ 62,927 $ 60,208 $ 184,904 $ 163,766 EMEA 37,447 35,109 106,592 102,114 Latin America 3,547 5,470 10,893 14,039 Asia Pacific 5,778 5,929 17,376 16,341 Total revenue $ 109,699 $ 106,716 $ 319,765 $ 296,260 |
Basis of Presentation - Narrati
Basis of Presentation - Narrative (Details) enterprise_customer in Thousands, developer in Millions | 9 Months Ended |
Aug. 31, 2020software_vendordeveloperenterprise_customer | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of independent software vendors (more than) | software_vendor | 1,700 |
Number of enterprise customers | enterprise_customer | 100 |
Number of developers | developer | 2 |
Cash, Cash Equivalents and In_3
Cash, Cash Equivalents and Investments (Summary Of Cash, Cash Equivalents And Available-For-Sale Investments) (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Cash, Cash Equivalents and Investments [Line Items] | ||
Cash and cash equivalents | $ 220,575 | $ 154,259 |
Unrealized Gains | 131 | 23 |
Unrealized Losses | 0 | 0 |
Total Amortized Cost Basis | 229,988 | 173,662 |
Total Fair Value | 230,119 | 173,685 |
State and municipal bond obligations | ||
Cash, Cash Equivalents and Investments [Line Items] | ||
Amortized Cost Basis | 7,036 | |
Unrealized Gains | 1 | |
Unrealized Losses | 0 | |
Fair Value | 7,037 | |
U.S. treasury bonds | ||
Cash, Cash Equivalents and Investments [Line Items] | ||
Amortized Cost Basis | 4,994 | 7,221 |
Unrealized Gains | 75 | 10 |
Unrealized Losses | 0 | 0 |
Fair Value | 5,069 | 7,231 |
Corporate bonds | ||
Cash, Cash Equivalents and Investments [Line Items] | ||
Amortized Cost Basis | 4,419 | 5,146 |
Unrealized Gains | 56 | 12 |
Unrealized Losses | 0 | 0 |
Fair Value | 4,475 | 5,158 |
Cash | ||
Cash, Cash Equivalents and Investments [Line Items] | ||
Cash and cash equivalents | 214,037 | 144,346 |
Money market funds | ||
Cash, Cash Equivalents and Investments [Line Items] | ||
Cash and cash equivalents | $ 6,538 | $ 9,913 |
Cash, Cash Equivalents and In_4
Cash, Cash Equivalents and Investments (Summary of Cash, Cash Equivalents and Available-for-sale Investments by Balance Sheet Classification) (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Cash, Cash Equivalents and Investments [Line Items] | ||
Cash and Equivalents | $ 220,575 | $ 154,259 |
Short-Term Investments | 9,544 | 19,426 |
State and municipal bond obligations | ||
Cash, Cash Equivalents and Investments [Line Items] | ||
Short-Term Investments | 7,037 | |
U.S. treasury bonds | ||
Cash, Cash Equivalents and Investments [Line Items] | ||
Short-Term Investments | 5,069 | 7,231 |
Corporate bonds | ||
Cash, Cash Equivalents and Investments [Line Items] | ||
Short-Term Investments | 4,475 | 5,158 |
Cash | ||
Cash, Cash Equivalents and Investments [Line Items] | ||
Cash and Equivalents | 214,037 | 144,346 |
Money market funds | ||
Cash, Cash Equivalents and Investments [Line Items] | ||
Cash and Equivalents | $ 6,538 | $ 9,913 |
Cash, Cash Equivalents and In_5
Cash, Cash Equivalents and Investments (Fair Value of Debt Securities by Contractual Maturity) (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Investments and Cash [Abstract] | ||
Due in one year or less | $ 5,703 | $ 14,004 |
Due after one year | 3,841 | 5,422 |
Total | $ 9,544 | $ 19,426 |
Derivative Instruments (Narrati
Derivative Instruments (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Nov. 30, 2019 | Jul. 09, 2019 | |
Other Noncurrent Liabilities | ||||||
Derivative [Line Items] | ||||||
Derivative liabilities | $ 7,500,000 | $ 7,500,000 | $ 2,100,000 | |||
Interest Rate Swap | ||||||
Derivative [Line Items] | ||||||
Notional amount | $ 150,000,000 | |||||
Fixed interest rate | 1.855% | |||||
Interest Rate Swap | London Interbank Offered Rate (LIBOR) | ||||||
Derivative [Line Items] | ||||||
Basis spread on variable rate | 0.00% | |||||
Forward Contracts | ||||||
Derivative [Line Items] | ||||||
Minimum maturity period, foreign currency derivative | 30 days | |||||
Maximum maturity period, foreign currency derivative | 2 years | |||||
Gain (loss) on foreign currency forward contracts | (4,500,000) | $ 1,600,000 | $ (2,100,000) | $ 2,900,000 | ||
Forward Contracts | Other Assets | ||||||
Derivative [Line Items] | ||||||
Derivative liabilities | 1,400,000 | 1,400,000 | ||||
Forward Contracts | Other Current Assets | ||||||
Derivative [Line Items] | ||||||
Derivative asset | $ 500,000 | $ 500,000 | ||||
Forward Contracts | Other Noncurrent Liabilities | ||||||
Derivative [Line Items] | ||||||
Derivative liabilities | $ 100,000 |
Derivative Instruments (Schedul
Derivative Instruments (Schedule of Derivatives) (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Derivative [Line Items] | ||
Notional Value | $ 70,358 | $ 68,408 |
Fair Value | 1,915 | (80) |
Interest rate swap contracts designated as cash flow hedges | ||
Derivative [Line Items] | ||
Notional Value | 144,375 | 148,125 |
Fair Value | (7,462) | (2,054) |
Forward contracts to sell U.S. dollars | ||
Derivative [Line Items] | ||
Notional Value | 70,358 | 66,951 |
Fair Value | 1,915 | (85) |
Forward contracts to purchase U.S. dollars | ||
Derivative [Line Items] | ||
Notional Value | 0 | 1,457 |
Fair Value | $ 0 | $ 5 |
Fair Value Measurements (Hierar
Fair Value Measurements (Hierarchy of Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Money market funds | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | $ 6,538 | $ 9,913 |
Money market funds | Level 1 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 6,538 | 9,913 |
Money market funds | Level 2 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 0 | 0 |
Money market funds | Level 3 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 0 | 0 |
State and municipal bond obligations | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 7,037 | |
State and municipal bond obligations | Level 1 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 0 | |
State and municipal bond obligations | Level 2 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 7,037 | |
State and municipal bond obligations | Level 3 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 0 | |
U.S. treasury bonds | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 5,069 | 7,231 |
U.S. treasury bonds | Level 1 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 0 | 0 |
U.S. treasury bonds | Level 2 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 5,069 | 7,231 |
U.S. treasury bonds | Level 3 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 0 | 0 |
Corporate bonds | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 4,475 | 5,158 |
Corporate bonds | Level 1 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 0 | 0 |
Corporate bonds | Level 2 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 4,475 | 5,158 |
Corporate bonds | Level 3 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 0 | 0 |
Foreign exchange derivatives | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 1,915 | |
Liabilities | (80) | |
Foreign exchange derivatives | Level 1 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 0 | |
Liabilities | 0 | |
Foreign exchange derivatives | Level 2 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 1,915 | |
Liabilities | (80) | |
Foreign exchange derivatives | Level 3 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Assets | 0 | |
Liabilities | 0 | |
Interest rate swap | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Liabilities | (7,462) | (2,054) |
Interest rate swap | Level 1 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Liabilities | 0 | 0 |
Interest rate swap | Level 2 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Liabilities | (7,462) | (2,054) |
Interest rate swap | Level 3 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Liabilities | $ 0 | $ 0 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill (Schedule Of Intangible Assets) (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 295,968 | $ 295,968 |
Accumulated Amortization | (214,034) | (196,576) |
Net Book Value | 81,934 | 99,392 |
Purchased technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 135,186 | 135,186 |
Accumulated Amortization | (110,941) | (105,967) |
Net Book Value | 24,245 | 29,219 |
Customer-related | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 134,042 | 134,042 |
Accumulated Amortization | (84,624) | (74,175) |
Net Book Value | 49,418 | 59,867 |
Trademarks and trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 24,740 | 24,740 |
Accumulated Amortization | (17,577) | (16,043) |
Net Book Value | 7,163 | 8,697 |
Non-compete agreement | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,000 | 2,000 |
Accumulated Amortization | (892) | (391) |
Net Book Value | $ 1,108 | $ 1,609 |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Intangible assets, amortization expense | $ 5.8 | $ 14.5 | $ 17.5 | $ 33.8 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill (Schedule Of Future Amortization Expense) (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2020 | $ 5,777 | |
2021 | 23,117 | |
2022 | 22,136 | |
2023 | 21,860 | |
2024 | 9,044 | |
Net Book Value | $ 81,934 | $ 99,392 |
Intangible Assets and Goodwil_5
Intangible Assets and Goodwill (Schedule of Goodwill) (Details) $ in Thousands | 9 Months Ended |
Aug. 31, 2020USD ($) | |
Goodwill [Roll Forward] | |
Balance, November 30, 2019 | $ 432,824 |
Measurement period adjustments | (838) |
Translation adjustments | (122) |
Balance, August 31, 2020 | 431,864 |
OpenEdge | |
Goodwill [Roll Forward] | |
Balance, November 30, 2019 | 366,819 |
Measurement period adjustments | (838) |
Translation adjustments | (122) |
Balance, August 31, 2020 | 365,859 |
Data Connectivity and Integration | |
Goodwill [Roll Forward] | |
Balance, November 30, 2019 | 19,040 |
Measurement period adjustments | 0 |
Translation adjustments | 0 |
Balance, August 31, 2020 | 19,040 |
Application Development and Deployment | |
Goodwill [Roll Forward] | |
Balance, November 30, 2019 | 46,965 |
Measurement period adjustments | 0 |
Translation adjustments | 0 |
Balance, August 31, 2020 | $ 46,965 |
Business Combinations (Narrativ
Business Combinations (Narrative) (Details) business in Thousands | May 31, 2020USD ($) | Apr. 30, 2019USD ($)business | Aug. 31, 2020USD ($) | May 31, 2020USD ($) | Aug. 31, 2019USD ($) | Aug. 31, 2020USD ($) | Aug. 31, 2019USD ($) | Nov. 30, 2019USD ($) |
Business Acquisition [Line Items] | ||||||||
Increase (decrease) in measurement period adjustments | $ (838,000) | |||||||
Goodwill | $ 431,864,000 | 431,864,000 | $ 432,824,000 | |||||
Stock-based compensation expense | 5,685,000 | $ 5,490,000 | 17,359,000 | $ 17,411,000 | ||||
Acquisition-related expenses | 1,125,000 | 253,000 | 1,439,000 | 1,360,000 | ||||
Acquired intangible assets | 111,300,000 | $ 111,300,000 | ||||||
Effective income tax rate | 24.50% | |||||||
Ipswitch | ||||||||
Business Acquisition [Line Items] | ||||||||
Total purchase consideration | $ 225,000,000 | |||||||
Escrow deposit | $ 22,500,000 | |||||||
Number of small and medium-sized businesses | business | 24 | |||||||
Increase (decrease) in measurement period adjustments | $ (618,000) | $ (600,000) | ||||||
Goodwill | 117,033,000 | $ 117,000,000 | 117,033,000 | |||||
Ipswitch | Restricted Stock Units | ||||||||
Business Acquisition [Line Items] | ||||||||
Equity interest issued | $ 2,000,000 | |||||||
Period of non-compete agreement | 3 years | |||||||
Intangible assets amortization period | 3 years | |||||||
Stock-based compensation expense | $ 500,000 | |||||||
Acquisition-related expenses | 100,000 | 400,000 | ||||||
Revenue of acquisition | $ 17,600,000 | $ 10,700,000 | $ 50,100,000 | $ 14,000,000 | ||||
Term Loan | Ipswitch | ||||||||
Business Acquisition [Line Items] | ||||||||
Term loan | $ 185,000,000 | |||||||
Term loan and maximum borrowing capacity | 401,000,000 | |||||||
Customer-related | Ipswitch | ||||||||
Business Acquisition [Line Items] | ||||||||
Finite-lived intangible assets | 66,600,000 | 66,600,000 | 66,600,000 | |||||
Purchased technology | Ipswitch | ||||||||
Business Acquisition [Line Items] | ||||||||
Finite-lived intangible assets | 33,100,000 | 33,100,000 | 33,100,000 | |||||
Trade name | Ipswitch | ||||||||
Business Acquisition [Line Items] | ||||||||
Finite-lived intangible assets | $ 9,600,000 | $ 9,600,000 | $ 9,600,000 |
Business Combinations (Assets A
Business Combinations (Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands | May 31, 2020 | Apr. 30, 2019 | May 31, 2020 | Aug. 31, 2020 | Nov. 30, 2019 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 431,864 | $ 432,824 | |||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||||
Goodwill | $ (838) | ||||
Ipswitch | |||||
Business Acquisition [Line Items] | |||||
Net working capital | $ 6,719 | $ 6,719 | |||
Property, plant and equipment | 4,661 | 4,661 | |||
Other assets | 310 | 310 | |||
Deferred revenue | (12,725) | (12,725) | |||
Goodwill | 117,033 | $ 117,000 | 117,033 | ||
Net assets acquired | 225,298 | 225,298 | |||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||||
Net working capital | 651 | ||||
Other assets | (4) | ||||
Deferred revenue | (29) | ||||
Goodwill | (618) | (600) | |||
Net assets acquired | 0 | ||||
Purchased technology | Ipswitch | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangible assets | 33,100 | $ 33,100 | 33,100 | ||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||||
Finite-lived intangible assets, useful life | 5 years | ||||
Trade name | Ipswitch | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangible assets | 9,600 | $ 9,600 | 9,600 | ||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||||
Finite-lived intangible assets, useful life | 5 years | ||||
Customer relationships | Ipswitch | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangible assets | $ 66,600 | $ 66,600 | $ 66,600 | ||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||||
Finite-lived intangible assets, useful life | 5 years | ||||
Previously Reported | Ipswitch | |||||
Business Acquisition [Line Items] | |||||
Net working capital | $ 6,068 | ||||
Property, plant and equipment | 4,661 | ||||
Other assets | 314 | ||||
Deferred revenue | (12,696) | ||||
Goodwill | 117,651 | ||||
Net assets acquired | 225,298 | ||||
Previously Reported | Purchased technology | Ipswitch | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangible assets | 33,100 | ||||
Previously Reported | Trade name | Ipswitch | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangible assets | 9,600 | ||||
Previously Reported | Customer relationships | Ipswitch | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangible assets | $ 66,600 |
Business Combinations (Proforma
Business Combinations (Proforma) (Details) $ / shares in Units, $ in Thousands | 9 Months Ended |
Aug. 31, 2019USD ($)$ / shares | |
Business Combinations [Abstract] | |
Revenue | $ | $ 325,248 |
Net income | $ | $ 24,381 |
Net income per basic share (in dollars per share) | $ / shares | $ 0.54 |
Net income per diluted share (in dollars per share) | $ / shares | $ 0.54 |
Term Loan and Line of Credit (N
Term Loan and Line of Credit (Narrative) (Details) - USD ($) | Oct. 05, 2020 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Apr. 30, 2019 |
Line of Credit Facility [Line Items] | ||||||
Due in next 12 months | $ 18,813,000 | $ 18,813,000 | ||||
Credit Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Additional borrowing capacity available | $ 185,000,000 | |||||
Interest rate of credit facilities | 1.81% | 1.81% | ||||
Principal repayments, option one | $ 1,900,000 | $ 1,900,000 | ||||
Principal repayments, option two | 3,800,000 | 3,800,000 | ||||
Principal repayments, option three | 5,600,000 | 5,600,000 | ||||
Principal repayments, option four | 7,500,000 | 7,500,000 | ||||
Principal repayments, three payment schedules | 9,400,000 | 9,400,000 | ||||
Debt issuance cost | 1,600,000 | 1,600,000 | ||||
Unamortized debt issuance costs | 1,200,000 | 1,200,000 | ||||
Amortization of debt issuance costs | $ 100,000 | $ 100,000 | $ 400,000 | $ 300,000 | ||
Percentage of capital stock of domestic subsidiaries | 100.00% | 100.00% | ||||
Percentage of capital stock of first-tier foreign subsidiaries | 65.00% | 65.00% | ||||
Credit Agreement | Revolving Line of Credit | ||||||
Line of Credit Facility [Line Items] | ||||||
Term loan | 301,000,000 | |||||
Unsecured credit facility | 100,000,000 | |||||
Additional borrowing capacity available | 125,000,000 | |||||
Fair value of term loan | $ 289,700,000 | $ 289,700,000 | ||||
Due in next 12 months | 16,900,000 | 16,900,000 | ||||
Line of credit facility outstanding amount | 0 | 0 | ||||
Credit Agreement | Revolving Line of Credit | Subsequent Event | Chef Software | ||||||
Line of Credit Facility [Line Items] | ||||||
Proceeds from lines of credit | $ 98,500,000 | |||||
Credit Agreement | Swing Line Loans | ||||||
Line of Credit Facility [Line Items] | ||||||
Term loan | 25,000,000 | |||||
Credit Agreement | Letter of Credit | ||||||
Line of Credit Facility [Line Items] | ||||||
Term loan | $ 25,000,000 | |||||
Line of credit facility outstanding amount | $ 1,900,000 | $ 1,900,000 | ||||
Minimum | Credit Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Commitment fee percentage | 0.25% | |||||
Minimum | Eurodollar | Credit Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate of credit facilities | 1.50% | 1.50% | ||||
Minimum | Base Rate | Credit Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate of credit facilities | 0.50% | 0.50% | ||||
Maximum | Credit Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Commitment fee percentage | 0.35% | |||||
Maximum | Eurodollar | Credit Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate of credit facilities | 2.00% | 2.00% | ||||
Maximum | Base Rate | Credit Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate of credit facilities | 1.00% | 1.00% |
Term Loan and Line of Credit (F
Term Loan and Line of Credit (Future Maturities) (Details) $ in Thousands | Aug. 31, 2020USD ($) |
Line of Credit Facility [Abstract] | |
Remainder of 2020 | $ 3,762 |
2021 | 18,813 |
2022 | 26,338 |
2023 | 33,863 |
2024 | 206,937 |
Total | $ 289,713 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Dec. 01, 2019 | Nov. 30, 2019 |
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | $ 24,011 | $ 0 | |
Operating lease, liability | $ 25,713 | ||
Accounting Standards Update 2016-02 | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | $ 28,900 | ||
Operating lease, liability | $ 29,900 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Term of contract (in years) | 1 year | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Term of contract (in years) | 10 years |
Leases - Lease Costs (Details)
Leases - Lease Costs (Details) $ in Thousands | 3 Months Ended | 9 Months Ended |
Aug. 31, 2020USD ($) | Aug. 31, 2020USD ($) | |
Leases [Abstract] | ||
Lease costs under long-term operating leases | $ 1,714 | $ 5,471 |
Lease costs under short-term operating leases | 235 | 379 |
Variable lease cost under short-term and long-term operating leases | 113 | 301 |
Operating lease right-of-use asset impairment | 0 | 1,189 |
Total operating lease cost | $ 2,062 | 7,340 |
Cash paid for leases | 5,979 | |
Right-of-use assets recognized for new leases and amendments (non-cash) | $ 204 | |
Weighted average remaining lease term in years | 4 years 6 months 3 days | 4 years 6 months 3 days |
Weighted average discount rate | 2.30% | 2.30% |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments After the Adoption of ASC 842 (Details) $ in Thousands | Aug. 31, 2020USD ($) |
Leases [Abstract] | |
Remainder of 2020 | $ 1,906 |
2021 | 6,267 |
2022 | 5,518 |
2023 | 5,325 |
2024 | 5,236 |
Thereafter | 2,841 |
Total lease payments | 27,093 |
Less imputed interest | (1,380) |
Present value of lease liabilities | $ 25,713 |
Leases - Schedule of Future M_2
Leases - Schedule of Future Minimum Lease Payments Before the Adoption of ASC 842 (Details) $ in Thousands | Nov. 30, 2019USD ($) |
Leases [Abstract] | |
2020 | $ 7,453 |
2021 | 5,711 |
2022 | 4,977 |
2023 | 5,017 |
2024 | 5,102 |
Thereafter | 2,904 |
Total | $ 31,164 |
Common Stock Repurchases (Detai
Common Stock Repurchases (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Jan. 31, 2020 | Nov. 30, 2019 | |
Equity [Abstract] | ||||||
Stock repurchase authorization | $ 250,000,000 | $ 75,000,000 | ||||
Common stock repurchased and retired (in shares) | 0 | 0 | 400,000 | 700,000 | ||
Common stock repurchased and retired | $ 20,000,000 | $ 25,000,000 | ||||
Remaining authorized repurchase amount | $ 230,000,000 | $ 230,000,000 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) - metric | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Long-Term Incentive Plan (LTIP) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of performance metrics | 2 | 2 | 2 |
Stock-based compensation award service period (in years) | 3 years | 3 years | 3 years |
Percentage of shares based on market condition of total shareholder return | 50.00% | 50.00% | 50.00% |
Cumulative performance condition | 3 years | 3 years | 3 years |
Percentage of shares based on cumulative performance condition | 50.00% | 50.00% | 50.00% |
Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation award service period (in years) | 4 years | ||
Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation award service period (in years) | 3 years |
Stock-Based Compensation (Class
Stock-Based Compensation (Classification of Stock-Based Compensation) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | $ 5,685 | $ 5,490 | $ 17,359 | $ 17,411 |
Cost of maintenance and services | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 322 | 317 | 979 | 811 |
Sales and marketing | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 1,035 | 968 | 3,195 | 3,205 |
Product development | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 1,693 | 1,529 | 5,518 | 5,393 |
General and administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | $ 2,635 | $ 2,676 | $ 7,667 | $ 8,002 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Aug. 31, 2020 | Nov. 30, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning balance | $ 330,282 | $ 324,002 |
Other comprehensive income (loss) before reclassifications, net of tax | (3,627) | |
Ending balance | 368,166 | 330,282 |
Other comprehensive income (loss), tax | 1,700 | 400 |
Accumulated Other Comprehensive Loss | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning balance | (29,974) | (28,176) |
Ending balance | (33,601) | (29,974) |
Foreign Currency Translation Adjustment | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning balance | (28,393) | |
Other comprehensive income (loss) before reclassifications, net of tax | 374 | |
Ending balance | (28,019) | (28,393) |
Unrealized (Losses) Gains on Investments | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning balance | (30) | |
Other comprehensive income (loss) before reclassifications, net of tax | 105 | |
Ending balance | 75 | (30) |
Unrealized Losses on Hedging Activity | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning balance | (1,551) | |
Other comprehensive income (loss) before reclassifications, net of tax | (4,106) | |
Ending balance | $ (5,657) | $ (1,551) |
Revenue Recognition - Unbilled
Revenue Recognition - Unbilled Receivables and Contract Assets (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Nov. 30, 2019 |
Revenue from Contract with Customer [Abstract] | ||
2021 | $ 6,694 | |
2022 | 1,866 | |
2023 | 180 | |
Total | $ 8,740 | $ 12,492 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Millions | Aug. 31, 2020 | Nov. 30, 2019 |
Disaggregation of Revenue [Line Items] | ||
Contract asset | $ 1.2 | $ 4 |
Deferred contract costs | $ 2.1 | $ 1.7 |
Minimum | ||
Disaggregation of Revenue [Line Items] | ||
Capitalized contract cost, amortization period | 3 years | |
Maximum | ||
Disaggregation of Revenue [Line Items] | ||
Capitalized contract cost, amortization period | 5 years |
Revenue Recognition - Deferred
Revenue Recognition - Deferred Revenue (Details) $ in Thousands | 9 Months Ended |
Aug. 31, 2020USD ($) | |
Contract With Customer, Liability [Roll Forward] | |
Beginning balance | $ 177,246 |
Billings and other | 313,875 |
Revenue recognized | (319,765) |
Ending balance | $ 171,356 |
Revenue Recognition - Performan
Revenue Recognition - Performance Obligations (Details) $ in Millions | Aug. 31, 2020USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 175 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-09-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing of satisfaction, period | 1 year |
Remaining performance obligation, percentage | 88.00% |
Restructuring Charges (Summary
Restructuring Charges (Summary of Restructuring Activity) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | $ 2,203,000 | |||
Costs incurred | $ 91,000 | $ 801,000 | 1,826,000 | $ 3,993,000 |
Cash disbursements | (3,131,000) | |||
Translation adjustments and other | (16,000) | |||
Ending Balance | 882,000 | 882,000 | ||
2019 Restructuring Activities | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 1,460,000 | |||
Costs incurred | 0 | 109,000 | ||
Cash disbursements | (1,404,000) | |||
Ending Balance | 165,000 | 165,000 | ||
2017 Restructuring Activities | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 552,000 | |||
Costs incurred | 1,448,000 | |||
Cash disbursements | (1,326,000) | |||
Translation adjustments and other | (15,000) | |||
Ending Balance | 659,000 | 659,000 | ||
Excess Facilities and Other Costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 196,000 | |||
Costs incurred | 1,678,000 | |||
Cash disbursements | (1,148,000) | |||
Translation adjustments and other | (16,000) | |||
Ending Balance | 710,000 | 710,000 | ||
Excess Facilities and Other Costs | 2019 Restructuring Activities | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Costs incurred | 0 | |||
Cash disbursements | 0 | |||
Ending Balance | 0 | 0 | ||
Excess Facilities and Other Costs | 2017 Restructuring Activities | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 5,000 | |||
Costs incurred | 1,409,000 | |||
Cash disbursements | (747,000) | |||
Translation adjustments and other | (15,000) | |||
Ending Balance | 652,000 | 652,000 | ||
Employee Severance and Related Benefits | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 2,007,000 | |||
Costs incurred | 148,000 | |||
Cash disbursements | (1,983,000) | |||
Translation adjustments and other | 0 | |||
Ending Balance | 172,000 | 172,000 | ||
Employee Severance and Related Benefits | 2019 Restructuring Activities | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 1,460,000 | |||
Costs incurred | 109,000 | |||
Cash disbursements | (1,404,000) | |||
Ending Balance | 165,000 | 165,000 | ||
Employee Severance and Related Benefits | 2017 Restructuring Activities | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 547,000 | |||
Costs incurred | 39,000 | |||
Cash disbursements | (579,000) | |||
Translation adjustments and other | 0 | |||
Ending Balance | $ 7,000 | $ 7,000 |
Restructuring Charges (Narrativ
Restructuring Charges (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Nov. 30, 2019 | |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring expenses | $ 91,000 | $ 801,000 | $ 1,826,000 | $ 3,993,000 | |
Restructuring reserve | 882,000 | 882,000 | $ 2,203,000 | ||
Operating lease, impairment loss | 1,200,000 | ||||
2019 Restructuring Activities | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring expenses | 0 | 109,000 | |||
Restructuring reserve | 165,000 | 165,000 | 1,460,000 | ||
2019 Restructuring Activities | Other Accrued Liabilities | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring reserve | 200,000 | 200,000 | |||
2017 Restructuring Activities | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring expenses | 1,448,000 | ||||
Restructuring reserve | 659,000 | 659,000 | $ 552,000 | ||
2017 Restructuring Activities | Other Accrued Liabilities | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring reserve | $ 700,000 | $ 700,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | May 31, 2019 | Feb. 28, 2019 | Aug. 31, 2020 | Aug. 31, 2019 |
Income Tax Contingency [Line Items] | |||||||
Effective income tax rate | 21.00% | (11.00%) | 22.00% | 18.00% | |||
Provision (benefit) for income taxes | $ 6,254 | $ (1,315) | $ 17,947 | $ 6,932 | |||
Scenario, Adjustment | |||||||
Income Tax Contingency [Line Items] | |||||||
Effective income tax rate | 18.00% | ||||||
Provision (benefit) for income taxes | $ (3,600) | ||||||
Tax Treatment Of Intercompany Sale Of Intellectual Property | |||||||
Income Tax Contingency [Line Items] | |||||||
Provision (benefit) for income taxes | $ 2,500 | $ 1,100 |
Earnings per share (Calculation
Earnings per share (Calculation of Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 23,977 | $ 13,557 | $ 62,061 | $ 31,140 |
Weighted average shares outstanding (in shares) | 45,036 | 44,716 | 44,941 | 44,761 |
Dilutive impact from common stock equivalents (in shares) | 328 | 587 | 441 | 531 |
Diluted weighted average shares outstanding (in shares) | 45,364 | 45,303 | 45,382 | 45,292 |
Basic earnings per share (in dollars per share) | $ 0.53 | $ 0.30 | $ 1.38 | $ 0.70 |
Diluted earnings per share (in dollars per share) | $ 0.53 | $ 0.30 | $ 1.37 | $ 0.69 |
Earnings per share (Narrative)
Earnings per share (Narrative) (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Earnings Per Share [Abstract] | ||||
Number of shares excluded from the calculation of diluted earnings per share (in shares) | 1,450 | 1,236 | 1,216 | 898 |
Business Segments and Interna_3
Business Segments and International Operations (Income from Continuing Operations by Segment) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020USD ($) | Aug. 31, 2019USD ($) | Aug. 31, 2020USD ($)segment | Aug. 31, 2019USD ($) | |
Segment Reporting [Abstract] | ||||
Number of reportable segments | segment | 3 | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Segment revenue | $ 109,699 | $ 106,716 | $ 319,765 | $ 296,260 |
Segment costs of revenue and operating expenses | 27,587 | 30,747 | 83,796 | 82,439 |
Segment contribution margin | 82,112 | 75,969 | 235,969 | 213,821 |
Other unallocated expenses | 48,919 | 60,009 | 146,755 | 167,711 |
Income from operations | 33,193 | 15,960 | 89,214 | 46,110 |
Other expense, net | (2,962) | (3,718) | (9,206) | (8,038) |
Income before income taxes | 30,231 | 12,242 | 80,008 | 38,072 |
OpenEdge | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Segment revenue | 85,794 | 78,607 | 240,608 | 211,679 |
Segment costs of revenue and operating expenses | 18,358 | 22,711 | 55,984 | 60,123 |
Segment contribution margin | 67,436 | 55,896 | 184,624 | 151,556 |
Data Connectivity and Integration | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Segment revenue | 4,468 | 8,754 | 21,815 | 27,686 |
Segment costs of revenue and operating expenses | 1,931 | 1,943 | 6,240 | 5,249 |
Segment contribution margin | 2,537 | 6,811 | 15,575 | 22,437 |
Application Development and Deployment | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Segment revenue | 19,437 | 19,355 | 57,342 | 56,895 |
Segment costs of revenue and operating expenses | 7,298 | 6,093 | 21,572 | 17,067 |
Segment contribution margin | $ 12,139 | $ 13,262 | $ 35,770 | $ 39,828 |
Business Segments and Interna_4
Business Segments and International Operations (Revenue from External Customers by Product) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Segment Reporting Information [Line Items] | ||||
Total revenue | $ 109,699 | $ 106,716 | $ 319,765 | $ 296,260 |
Software licenses | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 27,514 | 30,686 | 77,806 | 83,216 |
Performance obligations transferred at a point in time | Software licenses | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 27,514 | 30,686 | 77,806 | 83,216 |
Performance obligations transferred over time | Maintenance | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 72,764 | 67,611 | 214,506 | 190,138 |
Performance obligations transferred over time | Services | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | $ 9,421 | $ 8,419 | $ 27,453 | $ 22,906 |
Business Segments and Interna_5
Business Segments and International Operations (Revenue from External Customers from Different Geographical Areas) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Revenue from External Customer [Line Items] | ||||
Segment revenue | $ 109,699 | $ 106,716 | $ 319,765 | $ 296,260 |
North America | ||||
Revenue from External Customer [Line Items] | ||||
Segment revenue | 62,927 | 60,208 | 184,904 | 163,766 |
EMEA | ||||
Revenue from External Customer [Line Items] | ||||
Segment revenue | 37,447 | 35,109 | 106,592 | 102,114 |
Latin America | ||||
Revenue from External Customer [Line Items] | ||||
Segment revenue | 3,547 | 5,470 | 10,893 | 14,039 |
Asia Pacific | ||||
Revenue from External Customer [Line Items] | ||||
Segment revenue | $ 5,778 | $ 5,929 | $ 17,376 | $ 16,341 |
Subsequent Events - (Details)
Subsequent Events - (Details) $ in Millions | Oct. 05, 2020USD ($) |
Subsequent Event | Chef Software | |
Subsequent Event [Line Items] | |
Cash payments in business acquisition | $ 220 |